Oracle Claimed that Bidding for the Pentagon’s Massive Cloud Contract Favors Amazon. The Government Is Unconvinced

November 15, 2018, 11:42 AM UTC

Oracle has failed in its bid to protest against a $10 billion Pentagon cloud contract bidding process that the company—and many others—claim is designed for Amazon to win.

Oracle has been complaining about the bidding process for the Joint Enterprise Defense Infrastructure cloud, or JEDI, for months. It and other bidders such as Google, which withdrew its bid last month, said the contract should be split between different providers rather than going to just one winner. The idea is that this benefits Amazon because Amazon already has big government cloud contracts, most notably a $600 million deal with the CIA.

Oracle filed a formal bid protest with the U.S. Government Accountability Office (GAO) in August, complaining that the single-winner framing for the contract broke procurement rules. On Wednesday, the office denied Oracle’s protest.

“The Defense Department’s decision to pursue a single-award approach to obtain these cloud services is consistent with applicable statutes (and regulations) because the agency reasonably determined that a single-award approach is in the government’s best interests for various reasons, including national security concerns, as the statute allows,” the GAO said.

The office also turned down Oracle’s claim that there were conflicts of interest related to the procurement, saying the allegations “do not provide a basis for sustaining Oracle’s protest.”

“Oracle believes that both the warfighter and the taxpayer benefit most from a rigorous and truly competitive process,” spokeswoman Deborah Hellinger told Bloomberg. “We are convinced that if given the opportunity to compete, DoD would choose Oracle Cloud Infrastructure for a very substantial portion of its workloads.”

IBM has also lodged a protest over the bidding process, and the GAO said it would respond to that one by January 18 next year. Microsoft is also in the running for the contract.

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