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Pentagon Cancels Controversial $10bn ‘JEDI’ Cloud Contract

Ross Kelly

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JEDI Contract
After a lengthy legal dispute, the contract has been cancelled.

The Pentagon has announced it intends to scrap the controversial ‘JEDI’ cloud computing contract awarded to Microsoft.

In a statement yesterday (6th July), the US Department of Defense confirmed the multi-billion-dollar contract will be cancelled, citing changing technological needs.

“The Department has determined that, due to evolving requirements, increased cloud conversancy, and industry advances, the JEDI Cloud contract no longer meets its needs,” the statement read.

The Joint Enterprise Defense Infrastructure (JEDI) contract aimed to overhaul the DOD’s outdated computer systems with a cloud infrastructure, greatly enhancing the US military’s tech capabilities.

However, the Pentagon sparked controversy when it awarded the $10-billion contract to Microsoft in 2019. At the time, Amazon claimed that former President Donald Trump had unduly influenced the decision to award Microsoft the contract.

Amazon insisted that the decision to overlook the tech giant was politically motivated and spurred by President Trump’s dislike of Jeff Bezos. The incident sparked a lengthy and bitter legal battle.

In April last year, an investigation by the Defense Department inspector general’s office found the contract tendering process was legal and dismissed claims of politically-motivated interference.

September saw the Pentagon once again confirm Microsoft as the contract winner. However, earlier this year the Pentagon suggested it might be forced to scrap the contract after a federal court denied its requests to have Amazon’s lawsuit dismissed.

JEDI Contract

In a statement, Microsoft said it accepted the Pentagon’s decision.

“We understand the DoD’s rationale, and we support them and every military member who needs the mission-critical 21st century technology JEDI would have provided,” the tech giant said.

“The DoD faced a difficult choice: Continue with what could be a years-long litigation battle or find another path forward.”

Notably, Microsoft suggested the incident has highlighted flaws in both the contract award and subsequent legal processes.

“The 20 months since DoD selected Microsoft as its JEDI partner highlights issues that warrant the attention of policymakers: when one company can delay, for years, critical technology upgrades for those who defend our nation, the protest process needs reform,” the firm said.

Despite a frustrating legal battle, Amazon’s decision to contest the JEDI contract award may have opened up new opportunities for the DoD.

Speaking yesterday, the Pentagon’s acting chief information officer, John Sherman, told reporters that the long-running dispute highlighted rapid technological changes, which in turn played a key role in prompting the decision.

“In light of new initiatives, the evolution of the cloud ecosystem within DoD, and changes in user requirements to leverage multiple cloud environments to execute mission, our landscape has advanced and a new way-ahead is warranted to achieve dominance in both traditional and non-traditional warfighting domains,” Sherman commented.


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Moving forward, the DoD said JEDI will be replaced with a new initiative titled the ‘Joint Warfighter Cloud Capability’ programme.

The new programme will likely see both Amazon and Microsoft involved, the DoD said.

At present, the DoD said Amazon and Microsoft are the only cloud service providers “capable of meeting the Department’s demands”. However, it didn’t rule out opening up opportunities for alternative cloud computing providers, perhaps pointing to Google, Oracle or IBM.

“The Department will immediately engage with industry and continue its market research to determine whether any other US-based hyperscale CSPs can also meet the DoD’s requirements.”

Ross Kelly

Staff Writer

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