In a blow to Amazon, the Pentagon has upheld its $10 billion JEDI contract with Microsoft

  • The Department of Defense upheld its decision to award its JEDI contract to Microsoft, months after Amazon challenged the decision with a lawsuit.
  • The Pentagon last year chose Microsoft for a $10 billion cloud-computing contract to store and manage sensitive military and defense data.
  • Amazon challenged the decision, alleging political intervention in the US Court of Federal Claims. 
  • A federal judge found Amazon could likely prove the Department of Defense made at least one error in evaluating an aspect of Microsoft's proposal and that the mistake affected the outcome.
  • Still, after reevaluating its decision, the Pentagon announced Friday that "Microsoft's proposal continues to represent the best value to the Government."
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The Department of Defense is upholding its decision to award Microsoft its $10 billion cloud contract, it said Friday, months after Amazon filed a legal challenge. 

The Department of Defense last year chose Microsoft for its Joint Enterprise Defense Infrastructure (JEDI) deal, a colossal cloud project around storing and managing sensitive military and defense data. Amazon challenged the decision in court, alleging political interference from President Donald Trump, a frequent critic of the online retailer and its CEO, Jeff Bezos. 

In the course of the dispute, a federal judge found Amazon could likely prove the Department of Defense made at least one error, related to a storage requirement, in evaluating an aspect of Microsoft's proposal — and that the mistake affected the outcome.

The Department of Defense requested to remand the case to reconsider that aspect of the case. The judge granted the request, and the lawsuit was postponed.

But after it completed a "comprehensive re-evaluation of the JEDI Cloud proposals," the Department of Defense "determined that Microsoft's proposal continues to represent the best value to the Government," the Pentagon said in a press release on Friday.

Amazon also filed a complaint directly with the Department of Defense because it said the agency didn't clearly define the new storage requirement and was unresponsive to Amazon's request for clarification. The agency said on Friday that contract performance couldn't begin immediately because of a preliminary injunction order but added it was "eager to begin delivering this capability to our men and women in uniform."

Amazon did not immediately respond to a request for comment on Friday about the Pentagon's decision.

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