Microsoft (NASDAQ: MSFT) and Amazon.com (NASDAQ: AMZN) On Friday, a new round of gunshots were exchanged for a $ 10 billion defense cloud computing contract, Microsoft urging Amazon to withdraw, but Amazon promises to continue.
In October, the Pentagon awarded the JEDI (Joint Enterprise Defense Infrastructure) contract to Microsoft, a decision that surprised many people because Amazon was considered the precursor by most analysts. In November, Amazon launched an action to try to quash the sentence, claiming that Trump’s long-standing feud with Amazon and CEO Jeff Bezos led him to get involved and lead the contract with Microsoft.
The two sides have been fighting since then. Pentagon Inspector General weighed in April with mixed verdict, finding Defense Ministry followed proper procedures when selecting Microsoft, but said it was unable to conduct a review investigated the existence of interference in the White House due to the assertion of the presidential communications privilege.
The two sides exchange insults …
Microsoft on Friday in a blog article said it had received reports on Tuesday that Amazon had filed a new confidential protest with the Pentagon. Microsoft does not know what the protest says, “however, if their latest complaint reflects Amazon’s arguments in court, it is likely a new attempt to force a recovery, as they bet high and lost the first time”.
Amazon in a separate article did not mince words on Microsoft’s claims, saying that the company “has published several self-righteous and pontificative blog articles that are nothing but deceptive noise.”
Amazon said the initial reward was “fatally flawed on the six technical evaluation factors” and said the Pentagon had not resolved all of the issues identified by the courts during the tendering process. He said Microsoft was trying to “make its way to an unfair victory”, but said “we will not back down on this front”.
“Microsoft is doing a lot of postures. We understand why,” wrote Amazon. “No one, knowledgeable and objective, thinks they have the best offer. And this was further underscored by their erratic operational performance during the COVID-19 crisis.”
… and waving a lot of flags
Microsoft’s message, which was written by vice president of communications – and former sailor – Frank X. Shaw, is heavy in waving the flag. He writes wanting the best for the fighter, recalling the periods of active duty in the 1980s when he was forced to train in cold weather “carrying a 1950s sleeping bag and clothing “raincoats” from the 1970s “.
Shaw says Microsoft is simply trying to push the protest forward so that the Pentagon can benefit from modern technology.
“In the end, putting customer first is a good business strategy and one in which Amazon has traditionally excelled,” wrote Shaw. “In this case, I think of the customer not as a singular” DoD “, but as a soldier, sailor, aviator, or individual sailor who wants and deserves the best tools to do his job. And the best way in which Amazon can put these customers The first is to withdraw from its litigation, stop asking for a discount and let JEDI continue. “
Amazon vice president of communications Drew Herdener in his article said his company is also trying to do what’s best for the military.
“As we have always said, we believe it is essential for the DoD, the country and future American public markets that agencies make decisions without political reprisal or interference, and based on fairness and on the facts” wrote Herdener. “Neither will we allow blatant political interference or inferior technology to become an acceptable standard. We have a lot of respect and admiration for those who serve and are honored to support the DoD, but we will not stand by nor will we apologize for doing what we believe is fair, just and equitable. “
What happens next?
It is important to say that there is much more here than we do not know that we know. There is no point in trying to say who is the superior technology, especially since the Pentagon had specific directives in mind. There is also no point in trying to pretend that we know that the situation took place in the room at the time of the decision and which may have influenced the result.
What we do know is that JEDI is a top priority for the Pentagon, and defense officials have indicated in some comments that the program has been shelved while this appeal process is taking place.
Reading between the lines of the two declarations, Microsoft seems to be playing with this urgency to start the implementation work. If I were to guess that I would bet that Amazon is facing a tough battle from here, although if this contest has proven anything, it’s the danger of making too many assumptions.