The Pentagon on Tuesday said that it has scrapped a US$10 billion cloud computing contract, sidestepping a bitter dispute between Amazon.com Inc and Microsoft Corp over allegations of political bias that swayed the bidding.
A US Department of Defense statement said that the Joint Enterprise Defense Infrastructure (JEDI) contract was canceled because it no longer meets current needs and that it would start a process for a new “multi-cloud / multi-vendor” computing contract.
Microsoft in late 2019 won the contract, sparking a challenge by Amazon on the grounds that vengeful politics by then-US president Donald Trump might have improperly influenced the outcome.
Photo: AP
Officials said that instead of going forward with the deal in the face of litigation, the government would start over with the aim of getting the most up-to-date technology.
“JEDI, conceived with noble intent, was developed at a time when the department’s needs were different,” department spokesman John Sherman said at a news conference. “Now, we want to leverage multiple cloud environments.”
Sherman equated arming US “war fighters” with cutting-edge, 21st-century cloud computing capabilities to providing top armor or weaponry, saying the technology landscape has shifted since the JEDI contract was stalled by litigation.
A statement said that the Pentagon would seek proposals from Amazon and Microsoft on a new contract, adding that the two companies appear to be the only cloud service providers capable of meeting the department’s requirements.
The 10-year JEDI program was designed to see all military branches sharing information in a cloud-based system boosted by artificial intelligence.
Amazon alleged it was shut out of the deal because of what it called Trump’s vendetta against the company and its former chief executive Jeff Bezos.
Sherman said that it was urgent to move ahead and that “the overriding factor is not what may have happened in previous administrations; what was said or not said, the litigation.”
Amazon had been considered the lead contender to provide technology for JEDI, with Amazon Web Services dominating the cloud computing arena and the company already providing classified servers for other government agencies, including the CIA.
Amazon argued in court documents that the Pentagon’s choice of Microsoft was mystifying if not for Trump’s repeated “expressed determination to, in the words of the president himself, ‘screw Amazon.’”
US officials are to reach out to Amazon and Microsoft to solicit bids for parts of the new cloud contract, which Sherman said would have an overall value in the billions of dollars, without specifying an amount.
“We understand and agree with the ... decision,” Amazon said. “Unfortunately, the [JEDI] contract award was not based on the merits of the proposals and instead was the result of outside influence that has no place in government procurement.”
Microsoft president of US regulated industries Toni Townes-Whitley said in an online post that the company “respects and accepts” the decision.
“The [department] faced a difficult choice: Continue with what could be a years-long litigation battle or find another path forward,” Townes-Whitley wrote. “What matters now is the way forward.”
Defense officials also plan to reach out to Google, Oracle Corp, IBM Corp and other computing firms to assess whether they would be willing to enter the bidding for some of the jobs.
The department aims to begin awarding contracts early next year, with a hope of having systems starting to deploy by 2025.
KEEPING UP: The acquisition of a cleanroom in Taiwan would enable Micron to increase production in a market where demand continues to outpace supply, a Micron official said Micron Technology Inc has signed a letter of intent to buy a fabrication site in Taiwan from Powerchip Semiconductor Manufacturing Corp (力積電) for US$1.8 billion to expand its production of memory chips. Micron would take control of the P5 site in Miaoli County’s Tongluo Township (銅鑼) and plans to ramp up DRAM production in phases after the transaction closes in the second quarter, the company said in a statement on Saturday. The acquisition includes an existing 12 inch fab cleanroom of 27,871m2 and would further position Micron to address growing global demand for memory solutions, the company said. Micron expects the transaction to
Nvidia Corp’s GB300 platform is expected to account for 70 to 80 percent of global artificial intelligence (AI) server rack shipments this year, while adoption of its next-generation Vera Rubin 200 platform is to gradually gain momentum after the third quarter of the year, TrendForce Corp (集邦科技) said. Servers based on Nvidia’s GB300 chips entered mass production last quarter and they are expected to become the mainstay models for Taiwanese server manufacturers this year, Trendforce analyst Frank Kung (龔明德) said in an interview. This year is expected to be a breakout year for AI servers based on a variety of chips, as
Global semiconductor stocks advanced yesterday, as comments by Nvidia Corp chief executive officer Jensen Huang (黃仁勳) at Davos, Switzerland, helped reinforce investor enthusiasm for artificial intelligence (AI). Samsung Electronics Co gained as much as 5 percent to an all-time high, helping drive South Korea’s benchmark KOSPI above 5,000 for the first time. That came after the Philadelphia Semiconductor Index rose more than 3 percent to a fresh record on Wednesday, with a boost from Nvidia. The gains came amid broad risk-on trade after US President Donald Trump withdrew his threat of tariffs on some European nations over backing for Greenland. Huang further
Sweeping policy changes under US Secretary of Health and Human Services Robert F. Kennedy Jr are having a chilling effect on vaccine makers as anti-vaccine rhetoric has turned into concrete changes in inoculation schedules and recommendations, investors and executives said. The administration of US President Donald Trump has in the past year upended vaccine recommendations, with the country last month ending its longstanding guidance that all children receive inoculations against flu, hepatitis A and other diseases. The unprecedented changes have led to diminished vaccine usage, hurt the investment case for some biotechs, and created a drag that would likely dent revenues and
RSS