Microsoft’s surprise victory last week in a protracted competition to build the Pentagon’s war cloud has some critics asking whether politics played any role in the outcome.
Amazon was long seen as the frontrunner for the $10 billion, $10-year Joint Enterprise Defense Infrastructure (JEDI) project. The company’s chances appeared to be so good that some competitors such as Oracle challenged the process as tailor-made for the Seattle tech giant.
But President Donald Trump, a frequent critic of Amazon and its CEO Jeff Bezos, got involved over the summer by ordering a review of the procurement process.
In an interview Thursday, GeekWire asked Microsoft CEO Satya Nadella for his take on the situation, and whether he thought politics played a role.
GeekWire: Some people in the industry were surprised by this, that Microsoft won this contract. Should they have been surprised?
Satya Nadella: We don’t celebrate the awarding of a contract for us. We want to stay focused on, in this case, on the Department Of Defense, their mission and how we support them. I feel good about the fact that we were able to submit our proposal to their RFP and come out on the top. But this is just the start, and we now are very, very focused on ensuring that we meet their needs.
GW: Do you think that politics, and specifically President Trump’s stated objections to Amazon, played any role in Microsoft’s being awarded this contract?
Satya Nadella: To me, it goes back to, if anything, Microsoft staying out of politics and staying focused on what the customer’s needs are. There are some core capabilities we have, which were always differentiated. And it’s great to see that play out when it comes to how we built the cloud as a distributed computing fabric, and hybrid being core to our design. Those are all things that I think, in the end game, really stood out. Staying focused on our customer needs, and our innovation, and our differentiation, knowing that there’s great competition, is what we want to do.
Microsoft has managed to avoid the political spotlight over the past few years as its tech industry peers have been swept up in a range of issues in Washington D.C.
JEDI tasks Microsoft with overhauling the Defense Department’s entire IT infrastructure, creating a globally available and responsive network, and providing ongoing monitoring of issues like bugs and breaches. The system must be fortified with enhanced cyber defenses and robust encryption.
Related: What is JEDI? Explaining the $10B military cloud contract that Microsoft just won over Amazon
It’s a giant win for Microsoft and its budding cloud business that has been gaining market share on Amazon Web Services and continues to help power the company’s bottom line.
The Pentagon released its proposal for JEDI in early 2018, opting to go with a single-vendor approach rather than allowing multiple companies to submit bids for parts of the project. That rankled Oracle, which sued the Department of Defense, alleging favoritism toward Amazon.
When Microsoft landed the project last week, Amazon didn’t mince words. “We’re surprised about this conclusion,” an Amazon Web Services spokesperson said in a statement. “AWS is the clear leader in cloud computing, and a detailed assessment purely on the comparative offerings clearly lead to a different conclusion.”
Amazon could appeal the decision. A source familiar with the situation told GeekWire that Amazon is “evaluating its options.”
Read the full interview with Nadella here, and listen to the podcast below.
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