The US Department of Defense announced Friday that it handed Microsoft a giant online data storage contract for $ 10 billion, and for which Amazon also tendered.
The Joint Enterprise Defense Infrastructure Cloud (JEDI) contract is extended for 10 years and is part of one of the most extensive digital modernizations made by the Pentagon with the aim of making it more technologically agile.
In order to facilitate the deployment of a new “cloud” storage architecture, the Pentagon decided to assign a single contract, instead of dividing it into several tenders.RELATED
Oracle Corp had expressed concern about the contract award process, including the role of a former Amazon employee who worked on the project in the Department of Defense but refused, then left the Department of Defense and returned to Amazon Web Services.
Google had withdrawn a year ago from the Pentagon contest call, estimating that it could contradict its ethical "principles."
In particular, he said "he had not received the guarantee" that this contract "would be consistent with (his) principles on artificial intelligence."
Despite criticism in Silicon Valley about collaborations with the army or the police, Microsoft and Amazon had defended, shortly after Google's withdrawal, their participation in the call for bids.
The Pentagon announced in August the postponement of its tender until the new defense minister, Mark Esper, gave the green light.
Following the result, through a statement, a spokesman for Amazon Web Services (AWS) said the company was "surprised by this conclusion."
The company said a "purely detailed assessment of comparative offers" "would clearly lead to a different conclusion," according to the statement.
AWS is considering options to protest the contract, a person familiar with the matter told Reuters.
Although the Pentagon has the most powerful fighting force in the world, its information technology remains unfortunately inadequate, according to many officials.
Officials have complained about having obsolete computer systems and not being able to access files or share information as quickly as they could in the private sector.
This week, US Secretary of Defense Mark Esper withdrew from the review of the agreement due to the employment of his adult son with one of the original applicants for the contract, IBM Corp.
IBM had previously bid for the contract, but had already been eliminated from the competition.
In a statement announcing Microsoft as the winner, the Pentagon underlined its view that the competition was conducted fairly and legally.
"All (offers) were treated fairly and evaluated in a manner consistent with the evaluation criteria established by the application. Before the award, the department consulted with the DOD Inspector General, who informed the decision to proceed," he said. .
Microsoft shares rose 2.5% to $ 144.35 in after-hours operations after the news. Amazon shares fell 0.98% to $ 1,744.12.
The Pentagon said it had awarded more than $ 11 billion in 10 different cloud contracts in the last two years.
"As we continue to implement the DOD cloud strategy, additional contracts are planned for cloud services and the complementary migration and integration solutions necessary to achieve effective cloud adoption," said the Pentagon.
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