Google Drops Bid, IBM Protests DoD Cloud Contract
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The jockeying over a massive U.S. military cloud contract reached a fever pitch this week as one prominent contender dropped out while another filed a legal protest aimed at heading off a sole-source contract award for cloud services worth billions of dollars.
Faced with an internal revolt over the possible use of its cloud and AI technologies in warfare, Google unexpectedly withdrew this week from competing for the Defense Department’s massive Joint Enterprise Defense Infrastructure contract. The winner-take-all JEDI program could be worth as much a $10 billion over 10 years.
Separately, IBM launched a preemptive strike days before the deadline for submitting bids by joining Oracle in protesting Pentagon plans to award a sole-source cloud contract. “JEDI’s primary flaw lies in mandating a single cloud environment for up to 10 years,” IBM asserted in a blog post explaining its protest.
“Certain requirements in the [DoD request for proposals] either mirror one vendor’s internal processes or unnecessarily mandate that certain capabilities be in place by the bid submission deadline versus when the work would actually begin,” IBM claimed. Amazon Web Services (NASDAQ: AMZN), which provides cloud services to U.S. intelligence agencies, is widely considered the front-runner for the JEDI contract.
The IBM (NYSE: IBM) protest filed this week with the U.S. Government Accountability Office is part of an ongoing legal effort by cloud vendors to transform JEDI into a multi-vendor contract award. Oracle (NYSE: ORCL) successfully challenged a $950 million DoD cloud contract awarded last year to AWS partner REAN Cloud.
While Google also lacked the federal certifications needed to handle classified DoD data, widespread opposition to military work among Google engineers prompted the company to drop out of the JEDI competition.
Google (NASDAQ: GOOGL), which had also been lobbying the Pentagon for a multi-vendor approach, confirmed earlier this week it would not compete for the DoD cloud contract. The decision follows a company decision not to renew a contract for a military AI effort called Project Maven designed to accelerate DoD’s integration of big data and machine learning into its intelligence operations.
Company involvement in the AI project sparked sharp protests within the search giant, prompting Google to issue a set of AI principles precluding use of its AI technology in weapons.
“We are not bidding on the JEDI contract because first, we couldn’t be assured that it would align with our AI Principles," a Google spokesman said in a statement first reported by Bloomberg. "And second, we determined that there were portions of the contract that were out of scope with our current government certifications.”
Along with AWS, IBM and Oracle, Microsoft (NASDAQ: MSFT) is among the cloud vendors competing for the JEDI contract. Microsoft announced earlier this week that new cloud regions capable of handling sensitive and secret U.S. data would be available early next year. That certification is required for handling classified data.
Final bids for the JEDI contract are due Oct. 12. Despite the preemptive protests and the prospect of more after a contract is finally awarded, DoD officials told Congress in May they plan to stick with a single-source award to expedite the cloud rollout. Among the reasons were avoiding multiple contract awards that would require individual task orders.
“That pace could prevent DoD from rapidly delivering new capabilities and improved effectiveness to the warfighter that enterprise-level cloud computing can enable,” John Gibson II, the Pentagon’s chief management officer, told lawmakers.
