Microsoft or Amazon Positioned to Nab $10 Billion DoD Cloud Contract After Oracle’s Court Complaints Rejected

Technology firm Oracle has seen its legal claims against the wording of the Department of Defense’s single-provider cloud contract dismissed by the Federal Claims Court, paving the way for either Amazon Web Services or Microsoft Azure to be awarded the massive contract. The winner of the ten year, $10 billion Joint Enterprise Defense Infrastructure (JEDI) cloud contract is expected to be announced in August.

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Early on in the application process for the JEDI cloud project, both Oracle and IBM alleged that the parameters for the application were drawn up to favor AWS and Azure. Oracle’s complaints only grew after the DoD announced that Oracle and IBM were no longer in contention for the project in April.

Key among Oracle’s claims in its suit were allegations that two former AWS employees within the DoD—Deap Ubhi and Anthony DeMartino—pushed the JEDI procurement process in AWS’ favor. Oracle also challenged the DoD’s decision to choose a single provider under the contact, a move that Oracle argued violated federal procurement law; the DoD countered that a single provider was necessary to lower security risks.

Judge Eric Bruggink ultimately dismissed Oracle’s case, stating that Oracle didn’t have the necessary standing to file a suit as it failed to meet the DoD’s legal and valid contract criteria. He noted in a pre-judgement filing that Oracle wasn’t capable of meeting the DoD’s outlined requirements as the company’s data center network is not robust enough to ensure service during a major disaster. Bruggink also sided with the DoD’s arguments that there were no conflicts of interest behind the procurement process.

The Federal Claims Court dismissed a similar case filed by IBM earlier this year. The process to award the JEDI contract is now clear to proceed, with only AWS and Azure remaining eligible.

In the end, Oracle’s suit may end up benefitting another party: Microsoft. At the time of initial bids, Amazon was the only company that could meet the DoD’s security requirements; Microsoft’s bid was contingent on the promise that it will be able to meet these requirements if awarded the contract. The delay caused by Oracle’s suit has allowed Microsoft to gain DoD Impact Level 6 (IL6) compliance on certain data centers and roll out two additional Azure Government Secret regions.