9 rival tech companies are working together to prevent Amazon from landing a $10 billion cloud contract

Photo by Drew Angerer/Getty Images
  • The Pentagon’s $US10 billion cloud contract, scheduled to be awarded to a single company, has created strange bedfellows in the tech industry.
  • Amazon is the frontrunner to win the contract.
  • Amazon’s competitors have been protesting the winner-take-all approach for months, wanting the Pentagon to divvy up the spoils to more than one company.
  • And though these companies have been fierce rivals, they’re now reportedly banding together to coordinate their lobbying against an Amazon win.

While Google employees have successfully forced their company to vow publicly that it would go easy on the cloud contracts with Defence Department, other large tech companies have no such qualms.

Quite the reverse: A group of at least nine of them have set aside their rivalries to work together in the hope of forcing the Pentagon to divvy up its $US10 billion cloud to multiple vendors,Bloomberg’s Naomi Nix reports. The contract is known as the Joint Enterprise Defence Infrastructure, or JEDI.

These vendors – many of which have decades-long heated rivalries – are Oracle, SAP America, General Dynamics’s CSRA unit, Red Hat, VMware, Microsoft, IBM, Dell Technologies, and Hewlett Packard, Bloomberg reports.

As we previously reported, Amazon, the leader in cloud computing, is a near shoo-in to win the whole contract for itself, which was originally set up to be a awarded to a single cloud provider.

Oracle and Microsoft have been lobbying hard to prevent that from happening.

The IT rivals are coordinating things like wooing the press and putting pressure on the legislators and the defence folks involved, Bloomberg reports.

Their lobbying efforts have yielded a little fruit too. Earlier this month, the House Budget Committee passed legislation that threatened to halt funding for JEDI unless the Pentagon submitted a plan to use several vendors. But the Senate’s version of the same spending bill is more supportive of the single-source contract, FedScoop reports.

The contract is scheduled to be awarded in September, and the process for winning it has been highly contentious for months. Opponents of Amazon even went so far as to take out an ad in the New York Post – known to be one of Trump’s favourite publications – aimed directly at Trump, with imagery of a laughing Amazon CEO Jeff Bezos.

The $US10 billion prize is a big allure, but it’s not just about this particular contract. A win of this magnitude from the Pentagon would be an enormous vote of confidence in Amazon’s cloud that other enterprises would follow. With this win, Amazon, already the market leader, would be like the Road Runner of cloud computing glancing over his shoulder at Wiley Coyote with an eat-my-dust grin.

The possible dust-eaters have therefore decided that the enemy of the enemy is their friend.

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