Pentagon asks for time to reconsider $10B JEDI cloud contract awarded to Microsoft

The U.S. Department of Defense asks for more time to reconsider its $10 billion contract awarded to Microsoft last year. (Microsoft)

In a court filing on Thursday, the U.S. Department of Defense (DoD) said it "wishes to reconsider" the decision to award its $10 billion JEDI cloud contract to Microsoft.

U.S. government lawyers asked a federal judge to grant the Pentagon “120 days to reconsider certain aspects of the challenged agency decision,” the DoD said in a filing to the U.S. Court of Federal Claims late on Thursday, according to a story by Reuters.

RELATED: Judge pauses Microsoft's work on 10-year, $10 billion JEDI cloud contract


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Last month, U.S. Court of Federal Claims Judge Patricia Campbell-Smith issued an injunction to stop Microsoft from working on the Joint Enterprise Defense Infrastructure (JEDI) cloud contract, which was awarded to Microsoft on Oct. 25 despite Amazon being considered the front-runner.

Campbell didn't release her written opinion, and she also ordered Amazon to post $42 million in the event that the injunction was wrongly issued, according to Reuters, but the fact that she issued the injunction seems to indicate that Amazon's contention has merit.

Amazon has said that Microsoft's Azure cloud infrastructure didn't meet the technical requirements set forth by the Pentagon.

“DoD does not intend to conduct discussions with offerors or to accept proposal revisions with respect to any aspect of the solicitation other than price scenario,” according to the filing. The Pentagon wants to re-evaluate parts of the bidders’ price proposals and online marketplaces.

Amazon has called on the U.S. Defense Department to terminate the award, and conduct another review of the submitted proposals. Amazon has contended that President Donald Trump's dislike of Amazon CEO and Washington Post owner Jeff Bezos played a role in Microsoft winning the contract. 

“We are pleased that the DoD has acknowledged ‘substantial and legitimate' issues that affected the JEDI award decision, and that corrective action is necessary. We look forward to complete, fair, and effective corrective action that fully insulates the re-evaluation from political influence and corrects the many issues affecting the initial flawed award," according to an Amazon Web Services spokesperson, in an email Friday morning to FierceTelecom.

The JEDI contract was supposed to be awarded in September of 2018, but some of the competing companies contended that Amazon had an unfair advantage. The process was slowed after several investigations and legal battles. While Amazon, Microsoft, Oracle and IBM were all initially interested in the JEDI contract, it was set up to award the contract to just one cloud company.

On Friday, Wedbush Securities analyst Daniel Ives said he believed the Pentagon would split the JEDI contract, according to a story by Investor's Business Daily.

"While initially this was a single-source contract, we believe the writing is on the wall that the Pentagon needs to likely break up this contract in order to move it along and start the procurement process given how critical the JEDI deal is to the overall DOD and longer-term strategic global military operations/infrastructure," Ives wrote in a note to clients.

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