Pentagon Rethinks $16 Billion JEDI Contract That Amazon Believes Was Influenced By Trump

Pentagon Rethinks $16 Billion JEDI Contract That Amazon Believes Was Influenced By Trump

The U.S. Department of Defence has filed for permission to rethink some parts of the $US10 ($16) billion JEDI cloud computing contract it awarded to Microsoft back in October. In other words, Amazon refuses to let this thing go if there’s even the slightest chance it can wrest this deal from Microsoft’s fingers.

A quick recap of this monthslong saga. The $US10 ($16) billion JEDI contract was a meaty win for Microsoft after years of bidding, as it is a potentially decade-long initiative that entails providing cloud computing services to the DoD. Amazon was long considered to be the frontrunner, given that it holds a 48 per cent market share when it comes to cloud computing. And then in July, an Oracle document landed on President Trump’s desk insinuating that Amazon was orchestrating a “conspiracy” to win the military contract.

An inquiry was launched, no evidence of a conspiracy was found, but the damage was done. Amazon subsequently filed a federal court complaint saying it believes it lost the contract because Trump wanted to “screw” Amazon CEO Jeff Bezos.

This escalated last month when Amazon called for Trump to testify over the matter, and a judge then granted an injunction to halt work on the project.

U.S. government lawyers filed the request to reconsider in the U.S. Court of Federal Claims late Thursday. In the filing, they ask for “120 days to reconsider certain aspects of the challenged agency decision.” The parts up for reevaluation essentially deal with price proposals and online marketplaces. That said, the filing also says that the DoD doesn’t intend to talk with Amazon or Microsoft, or receive any proposal revisions as it reconsiders.

As you might expect, Amazon is happy with the development—especially as it has hammered home its opinion that Trump had undue influence over the final decision to award Microsoft the contract. “We are pleased that the DoD has acknowledged ‘substantial and legitimate’ issues that affected the JEDI award decision, and that corrective action is necessary,” an Amazon spokesperson told Reuters.

Meanwhile, Microsoft seems to be downplaying the significance of the DoD’s reevaluation. It did not oppose the motion, and a spokesperson told Reuters it “supports their decision to reconsider a small number of factors” as the fastest way to put the issue to bed.

As for the likelihood that this changes the DoD’s mind? There’s a pretty decent chance. In the filing, the DoD noted it wishes to “reconsider its award decision in response to the other technical challenges presented by AWS.”

Also, a federal judge recently noted that Amazon’s protest “is likely to succeed on the merits” of its argument that the Pentagon goofed in comparing the prices for Amazon and Microsoft’s individual proposals. That said, the DoD’s filing did say that the agency could potentially “Make decisions that would moot this action, in whole or in part, and may obviate the need for further litigation in this court.” So maybe, maybe not.