Pentagon Cancels $10 Billion Deal With Microsoft

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The Defense Department has cancelled the complicated and highly politicized saga of one of the most lucrative military tech contracts in U.S. history.

The Pentagon is officially terminating its $10 billion cloud computing contract with Microsoft, ending a tendering process hotly contested in court by rival Amazon.

Amazon has been suing the contract, known as JEDI, since 2019, when the company was shocked to lose the lucrative 10-year contract to Microsoft.

Amazon’s legal strategy also includes testimony from former President Donald Trump, who said his contempt for company founder Jeff Bezos affected the bidding process.

The Defense Department said Tuesday that the JEDI contract – short for Joint Enterprise Defense Infrastructure – no longer meets its requirements “due to evolving requirements, increased cloud conversancy, and industry advances.”

The agency said it is now pursuing a multi-company contract instead of a winner-take-all approach with JEDI, which has long faced criticism from lawmakers and experts.

The Pentagon said it would seek bids for the new multi-cloud contract from Amazon and Microsoft, as the two companies are currently the only ones equipped to meet the military’s demands.

Amazon again argued in a statement on Tuesday that awarding JEDI to Microsoft was the result of “outside influence” and not the merits of the company’s proposals.

For more information, read the original story in NPR.

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