Due to his son's work at IBM, U.S. Secretary of Defense Mark Esper has removed himself from the review of the Pentagon's $10 billion JEDI cloud-computing contract
Last year, IBM, along with Oracle, lost out on its proposals to provision the government's JEDI (Joint Enterprise Defense Infrastructure) project. In December, IBM lost its appeal. According to published reports, Esper's son, Luke Esper, has worked at IBM since February.
“Out of an abundance of caution to avoid any concerns regarding his impartiality, Secretary Esper has delegated decision making concerning the JEDI cloud program to Deputy Secretary [David] Norquist,” Chief Pentagon Spokesperson Jonathan Rath Hoffman said in a statement Tuesday. “The JEDI procurement will continue to move to selection through the normal acquisition process run by career acquisition professionals."
Given the convoluted process of awarding the JEDI contract, it was probably for the best that Esper stepped aside.
Last year the Pentagon put out an RFP for one vendor to manage its cloud needs, which includes a primary data repository for the military services worldwide. Back in April, the U.S. Department of Defense ruled that Amazon Web Services and Microsoft Azure were the finalists for the JEDI project because they best met the Pentagon's minimum criteria.
Microsoft and Amazon were the front-runners for the JEDI contract due to the depth of their cloud technologies and higher government security clearances, but Oracle and IBM objected to being excluded from the contract, and questioned the entire selection process.
After becoming Secretary of Defense in July, Esper started reviewing the JEDI contract in August after President Trump said during a White House press pool that Oracle and IBM had complained to him about the process of awarding the JEDI contract. President Trump has made his dislike of the Washington Post and Amazon Web Services' Jeff Bezos well known.
The JEDI contract, which was supposed to be awarded in September of last year, has seen its share of controversy with some of the companies contending that AWS has an unfair advantage. The process was slowed after investigations and a legal battle.
The Pentagon found potential ethical violations by a former Amazon Web Services employee who had worked on JEDI during a stint at the Defense Department, according to a New York Times story. Those potential violations were referred to Office of Inspector General for further investigation. A Pentagon spokeswoman said that employee had “no adverse impact on the integrity of the acquisition process.”
In December, Oracle filed a lawsuit in the U.S. Court of Federal Claims that alleged there were conflicts of interests and unfair requirements in the contract process.
That lawsuit came on the heels of companies, including Oracle and IBM, lobbying the Defense Department to split the contract among several cloud providers instead of awarding it to just one. The Defense Department previously said splitting up the contract would slow down the process and cause a delay in providing the new capabilities to the military branches. IBM has maintained that the contract would be better served by multiple cloud providers instead of just one.