Amazon appeals the Trump administration's $10B "JEDI" contract (which Microsoft won)

Tuesday, December 10, 2019 by Robinhood Snacks | Disclosures

When you really, really want that JEDI military contract

Bezos pulled a Belichick... tossing the ol' red flag and demanding that the ref review the play. The Trump administration granted Microsoft an aggressively lucrative contract to manage the Defense Department's critical digital data in the cloud. Big loss for Amazon:

  • Huge: The US Department of Defense is America's largest employer, with over 3M employees/contractors handling enourmous amounts of computer files.
  • Sensitive: Storing sensitive military data is high-stakes stuff (think secret docs outlining strike targets or secret dinner menus for military mess halls).
  • Lucrative: $10B over 10 years. That's a lot, even for Amazon (its AWS cloud computing division made $26B in revenue last year).

Unfair call?... Analysts expected Amazon Web Services to win the deal because it boasts the biggest cloud in cloud computing — what Kleenex is to tissues, AWS is to fancy digital storage. But it didn't.

  • Amazon claims that President Trump sabotaged its bid because he doesn't like The Washington Post, which Amazon CEO Jeff Bezos happens to own.
  • Amazon's asking a judge to rule the contract unlawful, since military spending shouldn't be influenced by personal beef.
  • Best-case scenario for Amazon: The judge forces the administration to reconsider the contract.

Let's talk about business ethics, baby... From insider trading to condoning sexual harrassmant, the answer is no to all (always). Those aren't ethical dilemmas — there's no gray area. But Amazon's situation smacks personal values against legal profit opportunities. It's the type of ethical challenge that dominates Big Tech right now.

  • Should Google — the leader in information transparency — let China block search results that its government doesn’t want its citizens to see?
  • Should Amazon — if its employees oppose drone strikes — let the government use its servers for controversial military attacks?