Microsoft Beats Amazon For $10B Pentagon JEDI Contract

So much for the idea that the JEDI program was set up for Amazon.

The U.S. Department of Defense has picked Microsoft to build a cloud storage system for the military under a 10-year, fixed-price contract that could be worth up to $10 billion.

The decision comes after a bidding process that has been dogged by controversy, with Oracle, which was eliminated from contending, filing an ultimately fruitless court challenge, alleging that the contract had been tailored for Amazon.

Amazon Web Services had been considered the favorite to win the contract due to its cloud work for the CIA and its commanding share of the cloud services market.

The Joint Enterprise Defense Infrastructure program is meant to replace the U.S. military’s poorly integrated, aged computer networks and clouds with a single cloud system that would encompass all networked assets, from soldiers on the ground to all of its combat aircraft and naval vessels.

The win could add $10 in value to Microsoft shares, Wedbush analyst Daniel Ives said in a client note, and is an indicator of Microsoft’s healthy chances in its competition with Amazon for the $1 trillion in cloud services spending the research firm expects over the next decade. “This is a game changer deal for Microsoft to win as this will have a ripple effect for the company's cloud business for years to come,” he wrote.

An Amazon spokesman declined to address whether the company would protest the award. “We’re surprised about this conclusion,” he said. “AWS is the clear leader in cloud computing, and a detailed assessment purely on the comparative offerings clearly lead to a different conclusion.”

Since the contract is being awarded in segments, Amazon isn’t out of the game, says Daniel Gouré, a vice president at the Lexington Institute, a Washington, D.C., defense think tank. “The Pentagon could go with a second source down the road once they're comfortable.”

In early August, the Department of Defense said it was holding up the award for review by the newly confirmed Secretary of Defense, Mark Esper, weeks after President Trump had publicly expressed concern over complaints by competitors that the bid was rigged for Amazon. Trump’s interest in the contract raised eyebrows given his frequent attacks on Amazon CEO Jeff Bezos, who also owns The Washington Post.

Some critics had warned that it could be a security risk to have a single cloud provider for all branches of the military as well as the CIA.

In late August, Microsoft was one of the winners of a lower-profile defense cloud contract: the Defense Enterprise Office Solutions program, or DEOS. The DoD and the General Services Administration awarded the $7.6 billion contract to a team led by General Dynamics to provide word processing and spreadsheets, email and file sharing through Microsoft Office 365 products hosted on its Azure cloud.

After a protest by the losing bidder, the GSA said earlier this month that it would revise the contract, but both the contenders’ bids were based on Office 365.

“Instead of Amazon being the huge 10,000-pound gorilla at the Pentagon, maybe it'll be Microsoft,” says Gouré.

IBM and Oracle were eliminated from bidding for JEDI in April by the DoD, which judged they were unable to meet its Impact Level 6 security requirements for the military’s most sensitive data. Google dropped out of the running last year after months of protests by employees who wanted the company to stop doing defense work.

It’s possible that Microsoft could meet with similar opposition from its workers after the surprise JEDI victory. In February, a group of Microsoft employees called for the company to drop an $840 million contract to adapt HoloLens augmented reality technology for use by the U.S. Army.

Source: Jeremy Bogaisky
https://www.forbes.com
You can also get big contracts as the JEDI one, start up business in Mexico!
If you would like to find out more about this topic or are interested in receiving a complimentary business case analysis for your operation in Mexico, please fill out this form or contact us at:

US toll-free: +1 (877) 698 3905

CAN toll-free: +1 (844) 422 4922

start@americanindustriesgroup.com
Please note that we do not accept job applications here. If you are interested in applying for a position, please visit the following link: https://www.americanindustriesgroup.com/jobs/




Related posts

May 19, 2022
Aerospace industry Mexico
They highlight Querétaro’s position as “aerospace city of the future”
During his participation in the Mexico Aerospace Forum 2022 , Marco Antonio Del Prete Tercero , head of the Secretariat for Sustainable Development (Sedesu), described Querétaro […]
May 19, 2022
Automotive industry Mexico
Mexico rises to fourth place in the world as a producer of auto parts
Mexico managed to position itself as the fourth world producer of auto parts, surpassing the figures achieved by Germany in this subsector last year. At the […]
April 28, 2022
Aerospace Industry in Queretaro
Queretaro aerospace companies seek to gain 10% of the supply market in Mexico
The Tier 1 and OEM companies attached to the Aeroclúster de Querétaro seek to obtain 10% of their supply in the region in five years, anticipated […]
April 6, 2022
FreightCar America says moving production to Mexico is paying off
FreightCar America Inc. said its business is booming since it moved production to Mexico. The Chicago rail car company (Nasdaq: RAIL) announced in September 2020 that […]
March 10, 2022
What Is Going On in Mexico’s Aerospace Sector?
What Is Going On in Mexico’s Aerospace Sector?
For the past two years, Mexico’s aerospace and aviation sectors have focused on recovering from economic losses caused by the COVID-19 pandemic. Now, the industry has […]
March 10, 2022
Mexico exceeded 31,600 million dollars of foreign direct investment in 2021
Mexico exceeded 31,600 million dollars of foreign direct investment in 2021
The figure is the product of the difference of 45,084.9 million dollars registered as inflows and 13,473.7 million dollars in outflows, the SE specified. “The reported […]