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Microsoft Wins Massive JEDI Cloud Contract

Amazon loses in a $10-billion upset decision after months of legal and Trump-fueled political controversy.

After months of speculationintrigue, lawsuits, and presidential leaning-in, Microsoft has won the Pentagon’s $10 billion JEDI cloud storage contract, upsetting the presumed frontrunner Amazon Web Services.

The outcome comes as a surprise to many observers who described Amazon as the almost-certain winner of the Joint Enterprise Defense Infrastructure, or JEDI, program. Amazon was considered by many to be the only qualified bidder because it had the largest enterprise cloud infrastructure and already had reached the necessary highest security level, known as Impact Level 6.

Controversy has dogged the program from the beginning. Several competitors, led by Oracle, protested the Pentagon’s original requirements for the program, arguing that the rules favored Amazon over other, smaller providers. They even took their concerns directly to President Donald Trump, who has a well-known dislike for Amazon CEO Jeff Bezos. At one point, the president told then-Defense Secretary James Mattis to “screw” Amazon, according to a new book by a member of Mattis’s staff. In July, the president began to publicly question the competition; shortly thereafter, new Defense Secretary Mark Esper halted the program and launched a review. Just days ago, Esper unexpectedly announced he was recusing himself from the award decision because his son worked for IBM, a bidder that was eliminated in an early stage of the competition.

In a statement, Amazon officials expressed surprise at the announcement. AWS is currently the only cloud provider for the U.S. intelligence community, having hosted secret and top-secret classified data for nearly six years.

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