Amazon said Thursday that it will protest a Pentagon decision to award Microsoft a massive cloud-computing contract worth up to $10 billion, citing “unmistakable bias” and “political influence.”
The long-delayed Joint Enterprise Defense Infrastructure contract had been widely expected to go to Amazon Web Services but was instead awarded to rival Microsoft last month. Amazon spokesman Drew Herdener said in an emailed statement that contract awards should be “free from political influence.”
Amazon filed its notice to protest under seal with the Court of Federal Claims on Nov. 8. The company will still need to file a formal protest, laying out its arguments in detail to fight the Pentagon contract award.
The challenge came after an intense lobbying effort and a lawsuit filed by some of America’s biggest tech companies, which accused the military of favoring Amazon in a process that has dragged on for more than a year. During that time, Trump and other administration officials made it clear that they did not want the contract to go to Amazon. Federal acquisition laws forbid politicians, including the president, from influencing contract awards.
The award to Microsoft in late October came as a surprise to many who had been watching the competition.
“AWS is uniquely experienced and qualified to provide the critical technology the U.S. military needs, and remains committed to supporting the DoD’s modernization efforts,” Herdener said. “We also believe it’s critical for our country that the government and its elected leaders administer procurements objectively and in a manner that is free from political influence. Numerous aspects of the JEDI evaluation process contained clear deficiencies, errors, and unmistakable bias- and it’s important that these matters be examined and rectified.”
The language in Amazon’s response suggests the company is raising the stakes of the conflict, pitting the tech giant in a direct battle with Trump. Launching this process by publicly questioning bias and political influence will prompt a closer examination of the president’s role. And it will directly challenge the Pentagon’s independence from a White House that has not been shy about using military spending to achieve political ends.
(Amazon CEO Jeff Bezos owns The Washington Post.)
In an emailed response to Amazon’s statement Defense Department spokeswoman Elissa Smith said “we will not speculate on potential litigation.” Microsoft did not immediately provide comment.
Amazon is the commercial cloud computing market leader by a long-shot, holding a leading 48 percent market share, according to market-research firm Gartner. Microsoft is the second-largest with a 15.5 percent share.
Amazon is also the only company to hold the Defense Department’s highest-level security certification, called Impact Level 6. Microsoft made important strides during the year-long period the award was tied up in litigation, finalizing a number of partnerships that observers say may have narrowed the field somewhat.
The JEDI contract, announced in March 2018, is meant to modernize the Pentagon’s computing infrastructure in the hands of a commercial tech company. For more than a year, the Pentagon faced harsh criticism that the procurement was written with Amazon in mind. Oracle, which wanted the contract but was eliminated in an earlier phase of the competition, sued the Defense Department and Amazon in the U.S. Court of Federal Claims, alleging conflicts of interest on the part of numerous defense officials who had close relationships with Amazon. The procurement was repeatedly delayed while Oracle’s claims were investigated.
The procurement took a turn earlier this summer when Trump asked newly-installed Defense Secretary Mark Esper to re-examine the Pentagon’s broader approach to the contract, people familiar with the matter told The Post at the time, citing concerns it would go to Amazon. The President said on television that he had received “tremendous complaints” about the contract from Amazon’s competitors, specifically citing Oracle, IBM and Microsoft.
Soon afterwards he retweeted a link to a Fox News segment that referred to the contract as the “Bezos Bailout.”
Retired Navy commander Guy Snodgrass, who worked as a speechwriter for former Defense Secretary Jim Mattis, wrote in a recent book that Trump sought to “screw” Amazon out of the contract, and that Mattis refused to do so. Snodgrass’ claims have not been independently verified.
Esper recused himself from the process just weeks before the award, citing his son’s employment at one of the initial bidders.
Amazon could have filed its protest with the Government Accountability Office, which some experts had believed was the more likely venue because it could have stopped the contract with Microsoft from going into effect. Filing with the federal court, though, provides Amazon with a somewhat less rigid timetable for which to make its case.
Dana Deasy, the Defense Department chief information officer overseeing the source selection team, has argued that the JEDI procurement followed a two-tracked process in which Esper’s review of the procurement’s broader approach is completely separate from those who reviewed the bidders’ applications. Deasy said in a recent congressional hearing that the members of the source selection team remained anonymous throughout the process and, to his knowledge, were never contacted by the president.
Steve Schooner, a procurement lawyer with George Washington University, called Deasy’s testimony on that issue “fundamentally flawed.”
“The source selection evaluation team makes a recommendation,” Schooner said in an email. “The source-selection official exercises discretion and is empowered NOT to follow the source selection evaluation team’s recommendation.”
President Trump has previously interfered in procurement matters. In his first year in office the president participated directly in high-profile negotiations over the Pentagon’s purchase of F-35 fighter jets. Lockheed Martin later credited his “personal involvement” in the negotiations.