Pentagon hands Microsoft $10bn ‘war cloud’ deal, snubs Amazon

Pentagon hands Microsoft $10bn ‘war cloud’ deal, snubs Amazon
Visitors stand in front of a display screen at a Microsoft store. (File/Reuters)
Updated 26 October 2019

Pentagon hands Microsoft $10bn ‘war cloud’ deal, snubs Amazon

Pentagon hands Microsoft $10bn ‘war cloud’ deal, snubs Amazon
  • The contract is part of a broad modernization of the Pentagon’s information technology systems

SAN FRANCISCO: The Pentagon awarded Microsoft a $10 billion cloud computing contract , snubbing early front-runner Amazon, whose competitive bid drew criticism from President Donald Trump and its business rivals.
Bidding for the huge project, known as Joint Enterprise Defense Infrastructure, or JEDI, pitted leading tech titans Microsoft, Amazon, Oracle and IBM against one another.
The giant contract has attracted more attention than most, sparked by speculation early in the process that Amazon would be the sole winner of the deal. Tech giants Oracle and IBM pushed back with their own bids and also formally protested the bidding process last year.
Oracle later challenged the process in federal court, but lost .
Trump waded into the fray in July, saying that the administration would “take a very long look” at the process, saying he had heard complaints. Trump has frequently expressed his ire for Amazon and founder Jeff Bezos, who also owns the Washington Post. At the time, he said other companies told him that the contract “wasn’t competitively bid.”
Defense Secretary Mark Esper recused himself from the controversial bidding process earlier this week, citing a conflict of interest because his son works for one of the companies that originally bid.
The JEDI system will store and process vast amounts of classified data, allowing the US military to use artificial intelligence to speed up its war planning and fighting capabilities.
A cloud strategy document unveiled by the Defense Department last year called for replacing the military’s “disjointed and stove-piped information systems” with a commercial cloud service “that will empower the warfighter with data and is critical to maintaining our military’s technological advantage.”
The Pentagon emphasized in an announcement that the process was fair and followed procurement guidelines. It noted that over the past two years, it has awarded more than $11 billion in ten separate cloud-computing contracts, and said the JEDI award “continues our strategy of a multi-vendor, multi-cloud environment.”
The latter statement appeared designed to address previous criticism about awarding such a large deal to one company.
The deal is a major win for Microsoft’s cloud business Azure, which has long been playing catch-up to Amazon’s market leading Amazon Web Services. Microsoft said it was preparing a statement.
Amazon said Friday it was surprised by the decision.
“AWS is the clear leader in cloud computing, and a detailed assessment purely on the comparative offerings clearly lead to a different conclusion,” Amazon spokesman Drew Herdener said in a statement. “We remain deeply committed to continuing to innovate for the new digital battlefield where security, efficiency, resiliency, and scalability of resources can be the difference between success and failure.”
According to a July report from the research firm Gartner, Amazon holds almost 48% of the market for public cloud computing, followed by Microsoft in second place with close to 16%.
Over the last year, Microsoft has positioned itself as a friend to the US military. President Brad Smith wrote last fall that Microsoft has long supplied technology to the military and would continue to do so, despite pushback from employees.
Oracle and IBM were eliminated earlier in the process, leaving Microsoft and Amazon to battle it out at the end.
Google decided last year not to compete for the contract, saying it would conflict with its AI ethics principles. Google employees have been especially vocal in protesting the company’s involvement with government contracts.
“It’s a paradigm changer for Microsoft to win JEDI,” said Dan Ives, managing director of Wedbush Securities. “And it’s a huge black eye for Amazon and Bezos.”
Microsoft, Amazon, Google and other tech giants have faced criticism from their own employees about doing business with the government, especially on military and immigration related projects.


Malaysia takes legal action against EU over palm biofuel curbs

Malaysia takes legal action against EU over palm biofuel curbs
Updated 17 January 2021

Malaysia takes legal action against EU over palm biofuel curbs

Malaysia takes legal action against EU over palm biofuel curbs
  • Palm oil constitutes 30 percent of the global oils and fats production

KUALA LUMPUR: Malaysia is taking legal action at the global trade watchdog against the EU and member states France and Lithuania for restricting palm oil-based biofuels, the government said.

The world’s second largest palm oil producer, which has called a EU renewable-energy directive “discriminatory action,” is seeking consultations under the WTO’s Dispute Settlement Mechanism, the Plantation Industries and Commodities Ministry said in a statement.

Minister Mohd Khairuddin Aman Razali said the EU proceeded with implementing the directive without considering Malaysia’s commitment and views, even after Malaysia gave feedback and sent economic and technical missions to Europe.

The EU directive “will mean the use of palm oil as biofuel in the EU cannot be taken into account in the calculation of renewable energy targets and in turn create undue trade restrictions to the country’s palm oil industry,” he said in the statement.

The ministry filed the WTO request with cooperation from the Attorney General’s Chambers and the International Trade and Industry Ministry, taking action it had warned of in July against EU Renewable Energy Directive II.

Malaysia will act as a third party in a separate WTO case lodged by neighboring Indonesia, the world’s biggest palm oil producer, as a sign of solidarity and support, the ministry statement said.

Indonesia and Malaysia, together account for 85 percent of the global output of palm oil. Palm oil constitutes 30 percent of the global oils and fats production, and plays a significant role in fulfilling the demand in the global oils and fats market.

It is the world’s most produced and traded edible oil, and its versatility can be seen through its use in a wide range of food and nonfood products, which led to the remarkable palm oil consumption growth.

The US imported approximately $410 million of crude palm oil from Malaysia in 2020, CNN reported.