Pentagon Decided To Re-Evaluate The JEDI Contract And Amazon Is Not Giving Up

In February, Amazon.com, Inc. AMZN managed to temporarily stop the execution of the Joint Enterprise Defense Infrastructure Cloud (JEDI) contract between Pentagon and U.S. Department of Defense on one side, and Microsoft Corporation MSFT on the other. More precisely, on February 13^th, the U.S. Court of Federal Claims decided that Amazon's claims about the technical feasibility of the contract might be justified and they should be investigated further.

If you are asking yourself why this contract is important for both Amazon and Microsoft, remember that this contract should help the military with better access to data and technology from remote locations and it is worth $10 billion. On Tuesday morning, Amazon issued a notice saying that the Pentagon should not only re-evaluate one particular piece of the process, as this was just one flaw impacting all six elements of the technical evaluation. Amazon finds that DOD's proposed corrective action also works in Microsoft's favor and does not meaningfully address the numerous errors that Amazon identified in its complaint.

The Latest Development Of The JEDI Contract

A month after the Court of Federal Claims issued a stop decision, the Pentagon filed a request for additional time to reconsider the JEDI award process. Pentagon based its request on Amazon's objections about the technical part of the contract, but that was not all Amazon has objected to. Besides the technical objections, Amazon pointed at some improper political influence when the Pentagon decided to award the contract to Microsoft.

Having in mind the hostility between Amazon's CEO Jeff Bezos and President Trump, we can assume what Amazon implied. But even when looking only at the technical issues, Amazon's standpoint was its offer had better technical merits in most segments compared to Microsoft. Maybe there is something to this since Amazon was considered a favorite to get the JEDI contract. Further confirmation of this is that the Pentagon asked for time to reconsider the decision, and the Court allowed 120 days for the review. That period might be extended, during which the contract is at a standstill. In other words, the Pentagon is buying time from the judge to fix that one thing so there might not be anything left for Amazon to object to and the case would be dismissed. But on Tuesday, Amazon replied that there are plenty more fundamental flaws to object to and it is certain that the judge will be on their side.

What Are Amazon's Other Activities During This Period?

The re-evaluation of the JEDI contract came during tough times. The COVID-19 pandemic has paused the entire economy, but not for all market players. Amazon hired 100,000 new employees and started giving temporary raises to manage to fulfill a surge in online ordering. And Amazon is not alone in this. Walmart Inc WMT is doing the same thing. It is hiring an additional 150,000 workers and giving temporary raises. One of the reasons for this is to avoid upsetting the customers, as well as its employees and keep them calm during this stressful time. So, there are some positive movements while we wait for the JEDI issue to resolve.

Microsoft Joins Other Tech Companies To Fight The Coronavirus Misinformation

A lot of information regarding COVID-19 is cruising on social media. But we cannot always be certain if that information is correct, just like we cannot realize why people would spread misinformation during such a critical time. That only increases the levels of stress and makes staying calm and at home more difficult. So, tech giants like Alphabet Inc GOOG, Facebook, Inc. FB, Microsoft and Twitter Inc TWTR decided to take action to fight all this misinformation. They all issued a joint announcement and invited other companies to join them in this quest. Let's see what they can do. If anyone can do something to ease this chaos a bit, it's Big Tech.

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