Pentagon chooses Microsoft over Amazon in $10 billion cloud computing contract

By Yana Berman

Microsoft contract is a part of a digital modernisation at the Pentagon

Microsoft has won a $10 billion tender to develop cloud computing technologies for the Pentagon, while another tech giant, Amazon, was left behind, Reuters reports.

In coming years Microsoft will develop the Joint Enterprise Defense Infrastructure Cloud (JEDI) for the military agency.

The JEDI is set to make the Pentagon more up-to-date in terms of technology. One of its key goals is to make data from battlefields and remote locations more accessible.

The contest initially involved major tech giants, including IBM and Oracle. However, they were eliminated from the competition.

Following the news, Microsoft shares were slightly up during the post-market trading, while Amazon stock was in decline.

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Amazon Web services might protest the award, as the company is not satisfied with the decision, sources familiar with the matter told Reuters. In an official statement the spokesman said the company was “surprised about this conclusion.”

According to CNN a new book, Holding The Line: Inside Trump's Pentagon with Secretary Mattis by former Mattis speechwriter and communications director Guy Snodgrass, sheds light on the Pentagon decision.

In his book, Snodgrass claims that the Pentagon's decision is based on direct orders from the US President. According to the official, in summer 2018 Trump called the then US secretary of defence James Mattis and urged him to "screw Amazon" out of the contest.

Earlier in October, Amazon founder and CEO Jeff Bezos lost his crown as the world’s richest man, being replaced once more by Microsoft’s Bill Gates.

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