Amazon, Microsoft war cloud race: Pentagon watchdog looking into potential 'misconduct'

Trump questions Pentagon's cloud-computing contract

Turning Point USA founder Charlie Kirk on billionaire investor Peter Thiel's calls to investigate Google's alleged ties to China and President Trump's concerns over the Pentagon's cloud-computing contract it is poised to award to Amazon or Microsoft.

The Pentagon’s Office of the Inspector General on Tuesday released information about its review of the lucrative Department of Defense Joint Enterprise Defense Infrastructure (JEDI) cloud contract, which includes allegations of conflicts of interest and potential misconduct.

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A spokeswoman from the office confirmed in a statement that a “multidisciplinary team of auditors, investigators, and attorneys” are looking to how the DoD has handled the JEDI acquisition – including everything from how it developed requirements to the request for proposal process.

“In addition, we are investigating whether current or former DoD officials committed misconduct relating to the JEDI acquisition, such as whether any had any conflicts of interest related to their involvement in the acquisition process,” the spokeswoman said.

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She added that the team is making “substantial progress,” and intends to write a report to U.S. Defense Secretary Mark Esper, DoD leaders and Congress on its findings. It will consider whether to release the results publicly.

As previously reported by FOX Business, the Department of Defense said a winner would not be announced until a review of the contract was completed.

The two remaining bidders are Amazon and Microsoft, which are the two companies the Department of Defense decided met its cloud requirement criteria. A winner was expected to be announced later this month.

A total of four companies – including Oracle and IBM – entered the bidding race, out of a total of five that were qualified, the DoD said last week, batting away complaints competition was unfairly restricted.

A number of lawmakers, including Republicans Florida Sen. Marco Rubio and Iowa Sen. Chuck Grassley, have voiced concerns about the procurement process and whether it has been anti-competitive.

Oracle – one of the initial contenders – has filed complaints regarding the JEDI contract, including over purported connections between Amazon employees and Department of Defense officials – and an alleged unfair bias toward the e-commerce giant. It also protested the agency’s decision to award the contract to a single company.

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Amazon was viewed as an early frontrunner due to its other standing cloud deals, including a $600 million cloud contract with the CIA. That indicates the company already has the approval to handle sensitive government data.

In reaction to concerns there were criteria that allegedly unfairly favored Amazon, DoD said its evaluation needs reflect what is required to support the warfighter and the company with the best capabilities will win.