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The big picture: After reviewing 31.2 GB of emails, one gigabyte of memos, meeting agendas, travel calendars and 80 interviews, the DoD’s Office of Inspector General concluded that the Pentagon cloud contract awarded to Microsoft wasn’t influenced by the White House. It also arrived at this conclusion while not being able to fully verify that possibility due to the “presidential communications privilege.”
The DoD’s Inspector General has cleared Microsoft’s $10 billion JEDI contract after no evidence of wrongdoing was found. It also noted that awarding the project to a single company as opposed to dividing it among competitors was in line with “applicable acquisition standards.”
This comes after Amazon disputed the decision alleging that President Trump personally intervened in the matter. The company argued that because of friction between Trump and Amazon CEO Jeff Bezos, the former pressured Pentagon officials to award the contract to the closest competitor.
Last month, Amazon won a preliminary injunction that prevents Microsoft and the DoD from executing on the cloud project for 120 days. In a different lawsuit pending an appeal, Oracle is arguing that the terms of the contract bidding were tailored for Amazon, a scheme that was disrupted by a conflict of interest between Jeff Bezos and the Trump administration.
At this point, it doesn’t look like either case is going to lead to a different conclusion, and the DoD appears to have settled on the idea that the noise around this case should quiet down now that its internal probe hasn’t found any evidence of misconduct.
Frank Shaw, Microsoft’s head of corporate communications, noted that “the Inspector General’s report makes clear the DoD established a proper procurement process. It’s now apparent that Amazon bid too high a price and is seeking a do-over so it can bid again. As the IG’s report indicates, Amazon has proprietary information about Microsoft’s bid that it should never have had. At this stage, Amazon is both delaying critical work for the nation’s military and trying to undo the mistake it made when it bid too high a price.”
Amazon, however, isn’t ready to throw in the towel just yet. The company said in a statement that the DoD’s 313-page report “doesn’t tell us much. It says nothing about the merits of the award, which we know are highly questionable based on the Judge’s recent statements and the government’s request to go back and take corrective action. And, it’s clear that this report couldn’t assess political interference because several DoD witnesses were instructed by the White House not to answer the IG’s questions about communications between the White House and DoD officials.”
Simply put, Microsoft argues that Amazon was allowed to receive information about its winning price, as well as sensitive trade secrets that could be used by the latter as an unfair advantage on the cloud market.
Amazon believes that the DoD selection process unfairly rated Microsoft’s technology as equal or superior on all criteria including the cost of implementation. Now its case hinges on the fact that officials who could have confirmed its allegations were barred from answering questions in the DoD’s internal probe.
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