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Losing the $10 billion JEDI contract is bad for Microsoft not just because of the money — it's about credibility

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11.07.2021

On Tuesday, the Department of Defense announced it was canceling its massive Joint Enterprise Defense Infrastructure (JEDI) contract exclusively with Microsoft, and instead suggested it may pursue a new deal to include both Microsoft's Azure and Amazon's AWS cloud services.

The cancelation is a blow to Microsoft, but not just because the deal was worth $10 billion over the next 10 years. More importantly, it's a blow to Microsoft's cloud-computing credibility.

When Microsoft first won the deal in October of 2019, it came as a bit of a surprise. Most observers expected the contract to be awarded to AWS. Even Microsoft appeared to be caught off-guard by the announcement.

The JEDI program was a huge vote of confidence for Microsoft from its most important customer, the US government. The company was tasked with a complete overhaul of the Department of Defense's cloud infrastructure, while providing the highest levels of cyber security.

Amazon challenged and eventually sued the federal government complaining that Microsoft was awarded the contract........

© Business Insider


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