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Amazon and Microsoft trade barbs over JEDI contract appeal

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Key Points
  • Amazon on Friday defended its decision to challenge the Pentagon's multibillion-dollar JEDI cloud computing award after Microsoft said the company was trying to "force a do-over to rescue its failed bid."
  • Amazon called the Pentagon's JEDI award process "fatally flawed" and lobbed several attacks at Microsoft, saying it's trying to "bully its way to an unjust victory."
  • The JEDI, or Joint Enterprise Defense Infrastructure, deal worth up to $10 billion has become one of the most tangled contracts for the Department of Defense.
Jeff Bezos, founder and CEO of Amazon, pictured on September 13, 2018.
Bloomberg | Getty Images

Amazon on Friday defended its decision to challenge the Pentagon's multibillion-dollar JEDI cloud computing award after Microsoft said the company was trying to "force a do-over to rescue its failed bid."

The JEDI, or Joint Enterprise Defense Infrastructure, deal is worth up to $10 billion and has become one of the most tangled contracts for the Department of Defense.

Microsoft was awarded the cloud computing contract on Oct. 25. In November, Amazon Web Services, Amazon's cloud computing unit, filed a lawsuit in the U.S. Court of Federal Claims protesting the JEDI decision. The company argues that President Donald Trump's bias against Amazon and its CEO, Jeff Bezos, influenced the Pentagon to give the contract to Microsoft.

In a blog post published Friday, Amazon called the Pentagon's JEDI award process "fatally flawed" and lobbed several attacks at Microsoft, saying it's trying to "bully its way to an unjust victory."

"Microsoft is doing an awful lot of posturing," wrote Drew Herdener, vice president of worldwide communications at Amazon. "We understand why. Nobody knowledgeable and objective believes they have the better offering. And, this has been further underscored by their spotty operational performance during the Covid-19 crisis (and in 2020 YTD)."

Last month, the Pentagon's inspector general released a report saying that the award did not appear to be influenced by the White House.

However, the inspector general noted in the 313-page report that it had limited cooperation from White House officials throughout its review and, as a result, it could not complete its assessment of allegations of ethical misconduct. 

In a statement to CNBC, Department of Defense spokesman U.S. Air Force Lt. Col. Robert Carver, said the Pentagon "continues to execute the procedures outlined in the Motion for Voluntary Remand granted last month with the intent of delivering this critically-needed capability to our warfighters as quickly as possible."

Earlier this week, AWS filed another bid protest with the Department of Defense seeking clarification of the Pentagon's amended storage requirements. Since the specifications weren't clearly defined, Amazon had "no option but to appeal to the agency to clarify it."

Microsoft said it didn't know the full scope of Amazon's appeal, but that the Pentagon's recent amendments "do not allow Amazon to undo its earlier business decision to bid high, which resulted in their loss."

This story was updated to include a statement from the Pentagon.

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