Secret meetings between Jeff Bezos and James Mattis throws $10 bn Amazon JEDI contract in doubt


10, 2019

Amazon and Microsoft are at war over a $10 billion opportunity to build the U.S. military its first “war cloud” computing system.  Whilst once considered an early favourite of the Pentagon back in 2017, allegations of secret meetings between company executives and the Pentagon may have jeopardised Amazon’s chances of sealing the deal.

A cloud strategy document unveiled by the Defence Department last year called for replacing the military’s “disjointed and stove-piped information systems” with a commercial cloud service “that will empower the warfighter with data and is critical to maintaining our military’s technological advantage.”

Artificial Intelligence technology would be utilised by JEDI to increase the speed of its war planning and fighting capabilities with Lt. Gen. Bradford Shwedo saying JEDI’s computing capabilities could help the U.S. analyse data collected from surveillance aircraft, predict when equipment needs maintenance, and speed up communications if fibre and satellite connections go down.

For years, Amazon Web Services has been the industry leader in moving businesses and other institutions onto its cloud; but Microsoft’s Azure cloud platform (like Google) is now becoming more and more prevalent in corporate and government settings.

Previously, there appeared to be a problem with Amazon’s bid for the $10 billion JEDI Pentagon contract after it was found that an ex-Amazon employee was instrumental in writing the procurement specifications. That employee then left to once again work for Amazon, creating the perception of a conflict of interest.

Now further meetings in 2017 between Defence Secretary Jim Mattis and an Amazon executive, as well as another meeting between Mattis and CEO Jeff Bezos have surfaced.  Last year, rivals Oracle and IBM lodged formal protests, arguing against the decision to award the Pentagon’s bid to a single vendor.  Sen. Chuck Grassley, Iowa Republican, said that the bidding process should be started over.

Oracle have taken their case to the Court of Federal Claims, including evidence of e-mails showing conflict of interest between Amazon and the government.  Amazon dismisses Oracle’s claims as exaggerations, and “tabloid sensationalism”.

Daniel Goure, vice president of the Lexington Institute, whose think tank gets funding from Amazon, but not from other cloud rivals; said that rivals like Oracle, Microsoft and IBM “missed the boat” in cloud technology, and are trying to make up lost ground through legal manoeuvres.  Pentagon spokeswoman Elissa Smith claims that no one in the defence secretary’s “front office” participated in drafting the contract requirements or soliciting bids.

Time will tell whether Amazon’s underhanded dealings will be rewarded or cost them the $10 billion contract.


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