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With the Pentagon’s $10 billion virtual “cloud of war” now dead, military officials and key lawmakers are faced with a troubling question: Can a company as powerful as Amazon effectively determine how the federal government will do business in the 21st century?
Defense industry analysts say the drama surrounding the unfortunate Joint Enterprise Defense Infrastructure (JEDI) initiative, which played out in courtrooms and boardrooms as Amazon Web Services struggled for a lucrative deal with both the Pentagon and industry rival Microsoft, sheds new light. leverages that some mega-corporations have to influence government deals.
Amazon’s legal challenge stalled the JEDI contract for more than a year, hindering the Pentagon’s effort to move large amounts of classified data into a single virtual clearinghouse that could be accessed from anywhere in the world by troops on land and sailors at sea. Defense officials pulled the plug on JEDI at the end of last week and said they would instead enter into a multi-company cloud contract, a move that will give both Amazon and Microsoft a bite of the apple.
While Amazon objected to Microsoft being rewarded with the JEDI deal in late 2019, it has shown itself as the victim of blatant political interference by former President Trump, who was a vocal critic of the company and its founder, Jeff Bezos.
There’s no doubt that Mr. Trump belittles the company. But defense industry experts say the Pentagon has set a dangerous precedent that can be copied by other firms that, for whatever reason, feel deceived. from big money contracts.
“Obviously an overwhelming disappointment. It shows me that I don’t know how [the Department of Defense] if major acquisition efforts can be crushed by litigation, bureaucracy or the stubbornness of industry, anything goes to buy,” said retired Army Lieutenant General Tom Spoehr, now director of the National Defense Center at the conservative Heritage Foundation. “I’m a little bit depressed about the future of cloud computing in the Department of Defense unless they start acting like football teams – everybody gets a trophy.”
Lieutenant General Spoehr said that in many cases defense contractors shy away from long-term contract disputes because they want to maintain friendly relations with the Pentagon in hopes of winning future deals. He said that with a multi-headed corporate giant like Amazon, the dynamics look radically different.
“DoD is a tiny little pup compared to their other business,” he said. “They almost don’t care if they create malicious intent.”
In its public statements, Amazon insisted it was committed to working with the Department of Defense on cloud computing for years to come.
Pentagon officials also oppose the idea that Amazon is pursuing a scorched earth strategy to challenge Microsoft’s first bid to win.
Since the contract was awarded to Microsoft, officials say the military’s cloud computing needs have evolved and a single-company deal is no longer necessary, which officials have long insisted is the safest and most cost-effective route.
“Designed with noble intent, JEDI was developed at a time when department needs were different,” Pentagon Chief Information Officer John Sherman told reporters on a conference call last week. “Our landscape has improved and a new path ahead is guaranteed.”
remaining questions
But few believe the military’s cloud computing requirements have changed drastically in the past 18 months, or that new delays will bring the Pentagon closer to its data goals.
Another potential contributor to JEDI’s death could be a recent decision by the US Federal Court of Claims. April’s court allowed Amazon’s accusations of political interference to move forward, meaning that if the Department of Defense had kept the JEDI in its original form, Mr.
Lieutenant General Spoehr said the Pentagon wanted to avoid such a scenario.
“They try to give a good face to a buying decision that blows up in their face,” he said. “His needs haven’t changed a bit. What they needed then, they still need now. ”
The Pentagon has steadfastly denied any political involvement in the decision-making process for JEDI, despite Mr Trump’s public statements and his known hostility to Mr Bezos, who also owns The Washington Post.
Amazon Web Services did not respond to a request for comment on whether its handling of JEDI sets a problematic precedent for future defense contracts or is worried about setting bad blood with the Pentagon leadership.
Company officials said last week that they are ready to work with the military on new cloud initiatives.
“Our commitment to supporting our nation’s military and ensuring that our warriors and defense partners have access to the best technology at the best price is stronger than ever,” an Amazon spokesperson said in a statement. We look forward to continuing to support the Department of Defense’s modernization efforts and creating solutions that will help them fulfill their critical mission.”
But key lawmakers and Amazon’s industry each dispute how the JEDI process plays out.
Microsoft officials said last week that the government should reform contracting processes.
“When a company is able to delay critical technology upgrades for years for those who defend our nation, the protest process needs reform,” said Toni Townes-Whitley, Microsoft’s head of US regulatory industries.
Meanwhile, some Republicans in Congress have their own questions. After media reports that the Pentagon’s internal emails in 2018 showed officials pushing the contract against Amazon, lawmakers say they want to know if the company is trying to use behind-the-scenes influence.
“It’s becoming increasingly clear that Amazon is using its market power and paid connections to cross ethical lines and avoid competition to win this contract,” said Senator Mike Lee of Utah and Ken Buck of Colorado. joint statement
“Now, more than ever, we need to take the oath to ask Amazon whether it is trying to improperly influence the largest federal contract in history,” the two Republicans said.
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