DOD Clears Microsoft’s JEDI Contract Award

Posted on April 15, 2020 by Paul Thurrott in Cloud, Microsoft with 14 Comments

In a sharp blow to Amazon, the U.S. Department of Defense found that Microsoft’s $10 billion Joint Enterprise Defense Infrastructure (JEDI) contract award was correct after an extensive review.

“We believe the evidence we received showed that the DOD personnel who evaluated the contract proposals and awarded Microsoft the JEDI Cloud contract were not pressured regarding their decision on the award of the contract by any DOD leaders more senior to them, who may have communicated with the White House,” the inspector general’s office said.

Microsoft won the lucrative contract in October but it was immediately contested by Amazon, which was widely expected to win the contract and claimed that the White House meddled to ensure it lost because of political reasons.

This week’s decision, issued as a 317-page report by the inspector general, means that the DOD found no such meddling. Furthermore, it also found that awarding the contract to a single company was “consistent with applicable acquisition standards.”

That said, the report also noted that the White House didn’t cooperate fully with its inquiry by issuing a “presidential communications privilege” in which the general counsel was not allowed to ask White House staff “questions about potential communications between White House and DoD officials about JEDI.” So it’s unclear how it arrived at this decision.

Finally, a Microsoft statement, provided to be this afternoon, provides additional information.

“The Inspector General’s report makes clear the DOD established a proper procurement process,” Microsoft’s Frank Shaw said. “It’s now apparent that Amazon bid too high a price and is seeking a do-over so it can bid again. As the IG’s report indicates, Amazon has proprietary information about Microsoft’s bid that it should never have had. At this stage, Amazon is both delaying critical work for the nation’s military and trying to undo the mistake it made when it bid too high a price.”


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Comments (14)

14 responses to “DOD Clears Microsoft’s JEDI Contract Award”

  1. lvthunder

    If it's Amazon claiming that the White House meddled for political reasons they should have to prove it or apologize to the DOD people who they are accusing without proof.

    • Paul Thurrott

      Um. Read the last paragraph, please.
      • lvthunder

        In reply to paul-thurrott:

        Just because the White House didn't cooperate fully doesn't mean they are guilty. After what Democrats and the press put the president through with impeachment if I were him I wouldn't willing to cooperate fully with anything unless I had to. Especially since they are all probably really busy with the National Emergency and all.

    • Pungkuss

      You can love Microsoft all you want, you have to agree that this smells bad. Trump didn't like Besos. Refused to say if they spoke to DOD officials about the process, but guarantee that it was fair. Lololol. This is what happens when you buy a newspaper Besos, sorry! It all turns into politics.
      In reply to lvthunder:

    • mrdrwest

      In reply to lvthunder:

      " too high"

  2. mefree

    Excellent news.

  3. smsteven

    As Amazon protested to the Federal Courts, the principal obstacle to Microsoft winning finally is there. I doubt the judge will take the word of the DOD more seriously now, even with this report, than she did before. Usually protests are lodged with the Government Accountability Office (GAO), but here Amazon chose to go to the Courts because they think that they will not get a fair hearing anywhere else. The key decision will be if the judge accepts the DOD's offer to revise the solicitation to fix the problems that were identified. If she does accept that means that Microsoft can easily amend its proposal to be compliant with the revised requirement and will take home the win. If she doesn't then it's hard to see how the procurement can continue as it essentially says that no solicitation can be fairly competed at this point.

  4. jrzoomer

    This was expected. I think you and Mary Jo even said that the chances that this would actually be overturned were slim to none.

    That last paragraph is jaw dropping.

    Nevertheless, I love Microsoft but objectively its just unfortunate that they had a winner take all approach. Things you don't expect can always happen (ie coronavirus), so why not build in some redundancy, its our National Defense we're talking about! Theres no reason this couldn't be done. Did it have to be this way?

    • smsteven

      In reply to jrzoomer:

      They didn’t need to take a winner takes all approach, and most other parts of the government would tap multiple vendors. Usually choosing a single vendor is step 1 where you have one partner help you transition to the cloud, and then step 2 is to open it up to multi-cloud (this is what the CIA is doing right now)

  5. yaddamaster

    Good. Next step is to dispel the notion that the bureaucracy gets to operate independent of the executive branch. Because political meddling isn't simply restricted to the WH (regardless of what party is involved). If Bezos wants to own both the company bidding on government contracts AND also control the opinion pieces of a major news source (oh, that's right - they're independent - and if you believe that......) then it cuts both ways.

    This consolidation of disparate industries (including financial) is not good for the country. imho.

  6. faustxd9

    Understanding the number of venues for reporting undue influence and the regulations that surround the people performing this acquisition and the subsequent review, it is just as likely that while the POTUS can say whatever he wants. It doesn't necessarily translate to the bowels of DoD personnel. There are contracts that have been overturned for way less.

    None of us know the details of this unless someone was on this team. Therefore, everything we all say is speculation at best to include my own statements. That being said, the last paragraph is mitigated by the second.

  7. bluvg

    Now just don't screw it up, Microsoft.

  8. red.radar

    So this was less about the why they didn’t win and more about Amazon creating a cloud of smoke so they could figure out why they lost, and in the process they gathered some business intelligence on their competition. .... clever... art of war clever.

    in the mean time we are all pawns In this story. Bezos uses the Post as a platform to mobilize the “orange man is bad army”. It creates negative social pressure and paints Microsoft as aligned with the axis of evil. In the mean time they can use the court system to get discovery on the detailed documents to why they lost. Thus getting business intelligence on their competitors distinct competitive advantages and creating negative social will on their competitors and DOD.

    Its just down right art of war clever. And I am sure the DOD allowed it because deep down they want a competitive landscape so they handed Amazon what they wanted under the protection of the courts discovery process. It’s just brilliant example of how our social divisions and this social media can be a weaponized platform for the powerful to manipulate public policy.

    The only people played here was Microsoft and the pawns that participated in creating the cloud of smoke.

    Microsoft’s silver lining: this is possible validation they have the best cloud in the industry and it’s not even close. Don’t stand still the competition is hungry.