Monday, July 26, 2021

Pentagon terminates $10 billion cloud contract with Microsoft

The U.S. Department of Defense has confirmed it has terminated a $10 billion contract with Microsoft Corporation (Microsoft) for cloud computing.

“Today, the Department of Defense (DoD) canceled the Joint Enterprise Defense Infrastructure (JEDI) Cloud solicitation and initiated contract termination procedures,” Pentagon wrote in a statement.

The release said that the Department has determined that, due to evolving requirements, increased cloud conversancy, and industry advances, the JEDI Cloud contract no longer meets its needs. The Department continues to have unmet cloud capability gaps for enterprise-wide, commercial cloud services at all three classification levels that work at the tactical edge, at scale — these needs have only advanced in recent years with efforts such as Joint All Domain Command and Control (JADC2) and the Artificial Intelligence and Data Acceleration (ADA) initiative.

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“JEDI was developed at a time when the Department’s needs were different and both the CSPs technology and our cloud conversancy was less mature. In light of new initiatives like JADC2 and AI and Data Acceleration (ADA), the evolution of the cloud ecosystem within DoD, and changes in user requirements to leverage multiple cloud environments to execute mission, our landscape has advanced and a new way-ahead is warranted to achieve dominance in both traditional and non-traditional warfighting domains,” said John Sherman, acting DoD Chief Information Officer.

Now that the $10 billion contract with Microsoft is canceled, the Pentagon plans to move forward with new cloud efforts, the statement said.

The Joint Warfighter Cloud Capability (JWCC) will be a multi-cloud/multi-vendor Indefinite Delivery-Indefinite Quantity (IDIQ) contract. The Department intends to seek proposals from a limited number of sources, namely the Microsoft Corporation (Microsoft) and Amazon Web Services (AWS), as available market research indicates that these two vendors are the only Cloud Service Providers (CSPs) capable of meeting the Department’s requirements. However, as noted in its Pre-Solicitation Notice, the Department will immediately engage with industry and continue its market research to determine whether any other U.S.-based hyperscale CSPs can also meet the DoD’s requirements. If so, those Department will also negotiate with those companies.

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About this Author

Dylan Malyasov
U.S. defense journalist and commentator. Aviation photographer. Dylan leads Defence Blog's coverage of global military news, focusing on engineering and technology across the U.S. defense industry.

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