
It bid high and lost. Should Amazon be allowed a do-over on JEDI? - Foe
https://blogs.microsoft.com/on-the-issues/2020/04/15/dod-amazon-jedi-contract/
======
partiallypro
My take on this whole thing, is the Amazon basically wrote the entire
scope...so they just thought they were going to win because only they would
meet it (this was a bit of a scandal just a few months back.) They bid high,
and then they lost. Now they are mad that their lobbying wasn't a 100%
success, so they are suing. It's all so very Amazon.

~~~
koheripbal
Amazon has put a LOT of money into DC. From setting up an HQ2 in DC to Bezos
personally purchasing the largest mansion in the city to host event for
political power brokers.

It should be no surprise that he's pissed that that amount of investment isn't
starting to pay dividends.

~~~
KarlKemp
You are mixing up "DC the actual city" and "DC as a synonym for politics".

DoD couldn't care less about Bezos' mansion or HQ2's impact on the city's
economy.

And running a newspaper that continuously annoys a President doesn't really
fit the apparently popular idea that Bezos is spending money to get favourable
treatment from politicians.

Especially when that politician you're annoying is known to have a somewhat
vindictive streak and doesn't quite grok the difference between being
entrusted money and power to use on behalf of a country and owning money and
spending it in his own interest

~~~
GCSAQCMIYI
>And running a newspaper that continuously annoys a President doesn't really
fit the apparently popular idea that Bezos is spending money to get favourable
treatment from politicians.

At least from outward appearances, most of the ruling class and permanent
government isn't particularly fond of the current President.

~~~
r_luna
That's what our current President and his "deep state" wants you to believe.
However, after three + years it's pretty obvious that our President has a firm
grip on power. He still plays the victim every once in a while. But all the
departments are quite clearly bowing and pleasing him as best they can.

~~~
SuoDuanDao
I don't know about that, he wasn't able to get the press to play nice on COVID
the way it did during swine flu.

~~~
derstander
In the US the press is not part of the state.

Also the swine flu was much less of a problem for the US: the CDC reported
less than 13,000 deaths in the US over a one year period vs stats today of
over 34,000 for COVID-19 in just a few months — despite the extra precautions
taken.

~~~
jazzyk
Slightly off-topic, but if you consider that 90% of "mainstream" media is
owned by 6 huge corporations, which are interested in maintaining crony
capitalism (of which the state is a central player) - then it would not be
completely outlandish to think that the press _is_ kinda part of state
(conceptually speaking)

[https://en.wikipedia.org/wiki/Concentration_of_media_ownersh...](https://en.wikipedia.org/wiki/Concentration_of_media_ownership)

~~~
cvlasdkv
it's the difference between explicit and invisible force. people in favour of
capitalism (in all its forms) consider the invisible forces "the way the world
works".

------
pnw_hazor
I wouldn't get too excited about a PR letter from a Microsoft lawyer.

IBM and Oracle made early protests that were dismissed, but Amazon's was
sustained. Note, Oracle is appealing the dismissal of its protest.

This is regarding the injunction that is in place now:

In the ruling, the judge said Amazon was likely to show that Microsoft offered
a “noncompliant storage solution” to reduce the costs of its JEDI bid and that
the Pentagon “erred” by not issuing a “deficiency” to Microsoft’s proposal.
The judge concluded that Amazon’s “chances of receiving the award would have
increased absent [the Pentagon’s] evaluation error.”

[https://www.nextgov.com/it-modernization/2020/03/amazon-
quit...](https://www.nextgov.com/it-modernization/2020/03/amazon-quite-likely-
prove-pentagon-made-evaluation-error-jedi-cloud-contract-judge-says/163610/)

------
ceejayoz
[https://www.politico.com/news/2020/04/15/pentagon-amazon-
tru...](https://www.politico.com/news/2020/04/15/pentagon-amazon-trump-
contract-187850)

> The Pentagon’s inspector general “could not definitively determine” whether
> the White House influenced the procurement process for a major cloud
> computing contract because senior Defense Department officials were barred
> from answering questions on the subject during interviews, according to a
> 313-page report released on Wednesday.

~~~
caseysoftware
A quote past the first paragraph of the story:

> _the IG said "we believe the evidence we received showed that the DoD
> personnel who evaluated proposals and made the source-selection awarding
> Microsoft the JEDI Cloud contract were not pressured about their decision on
> the award of the contract by any DoD leaders more senior to them, who may
> have communicated with the White House."_

As with most articles, the juicy, salacious lines are at the beginning but the
real details are 10 paragraphs in.

Based on the following paragraphs, the IG _did_ find evidence of ethical
misconduct by Amazon as they hired the DOD guy who helped form the JEDI
program.

~~~
ceejayoz
"The evidence we received" is fairly meaningless when coupled with "we weren't
allowed to obtain the evidence we _wanted_ ".

~~~
caseysoftware
I've lived through an IG investigation. You generally only want to respond in
writing so you give a correct and complete answer instead of misspeaking and
having it used against you, your project, or agency later on.

It doesn't hold the legal consequences of screwing up an FBI interview but can
be devastating professionally.

~~~
ceejayoz
> you give a correct and complete answer

The article asserts _no_ answer; that they were _forbidden to answer_ those
questions. Written or otherwise.

~~~
beerandt
>barred from answering questions on the subject _during interviews_

~~~
ceejayoz
There's such a thing as a written interview.

There's no indication they answered the questions in a written form; it
appears quite clear the White House asserted privilege, which would apply to
_any_ form of questioning.

~~~
beerandt
If "during interviews" was meant to cover _any_ form of questioning then the
sentence is obviously and improperly redundant.

>barred from answering questions on the subject _during interviews_.

vs

>barred from answering questions on the subject _when asked questions on the
subject_.

vs

>barred from answering questions on the subject.

It's a limiting modifier phrase, so the default is to assume it was meant to
modify the meaning.

~~~
ceejayoz
You can read the report, if you like.

It indicates the WH claimed privilege. Privilege applies to the
questions/answers, not the medium in which they’re asked.

------
TomMckenny
DoD officials are barred from answering questions about White House influence
on the decision owing to its assertion of "presidential communications
privilege"[1]. This is, quite simply, a confession.

Nothing is solved by believing that the administration is somehow different
than the dozen or so near identical leaders in other countries: that somehow
this one uniquely is not pressuring companies hostile to it (in spite of the
fact it has already publicly done so[2][3]).

And while a deferential Amazon might be bad, it's really something you'd want
to nip in the bud before Google or Facebook become too terrified of the white
house.

[1][https://www.politico.com/news/2020/04/15/pentagon-amazon-
tru...](https://www.politico.com/news/2020/04/15/pentagon-amazon-trump-
contract-187850)

[2][https://www.washingtonpost.com/news/politics/wp/2017/07/06/w...](https://www.washingtonpost.com/news/politics/wp/2017/07/06/would-
the-trump-administration-block-a-merger-just-to-punish-cnn/)

[3][https://www.wsj.com/articles/snag-in-media-merger-stirs-
tens...](https://www.wsj.com/articles/snag-in-media-merger-stirs-tensions-
over-trump-cnn-feud-1510354324)

~~~
23B1
> This is, quite simply, a confession.

That's like saying pleading the 5th is a confession...

~~~
TomMckenny
It's not a trial, it's the public asking their government to tell them what's
going on in this matter. And the government flatly refused. From this, it's
absolutely reasonable for the public to think its government is hiding
something now. And it's an order to _others_ in the DoD to remain silent. If
it were a trial, this is ordering potential witnesses to remain silent on
threat of termination.

What the White House is saying by claiming presidential privileged is 1) the
president did indeed discuss it, which in itself is problematic and 2) that
discussion is on par with a national security issue, which is an additional
abuse of power.

As an aside, the 5th exists to prevent coerced confessions. In court, it is
not to be taken as a sign of guilt because if it were, the point of the law
would be moot. Where no court (or police) are involved, there is no
possibility of coerced confession. Which is why everyone correctly views
refusing to answer questions to friends, parents or reporters as very much a
sign of guilt. And why confessions signed in police stations are very
suspicious in many people's eyes. It certainly does not allow a government to
refuse to answer to its people.

~~~
23B1
There are other reasons, inside government, to maintain privileged
information, e.g. 'legitimate secrets' and of course to protect precedent. You
don't want to burn down those principles for just anything.

------
gpm
> A central premise of the federal procurement system is that “full and fair
> competition“ on a “level playing field“ means that competitors are asked to
> make their best bids without knowing what the other has bid or will bid.
> That principle ensures that companies seeking to do business with the
> federal government offer their best price from the beginning.

No, it doesn't. This is known as a first-price sealed bid auction. It
guarantees they will roughly speaking offer the government the highest price
they think they will win at, not their lowest price. For a more detailed
analysis see the wikipedia aritcle: [https://en.wikipedia.org/wiki/First-
price_sealed-bid_auction](https://en.wikipedia.org/wiki/First-price_sealed-
bid_auction)

The "standard" (mathematical) answer to getting this property would be to run
a second-price sealed bid auction, where the winner is the player with the
lowest bid, but they get paid the amount of the second lowest bid,
[https://en.wikipedia.org/wiki/Vickrey_auction](https://en.wikipedia.org/wiki/Vickrey_auction)

I'm not sure how you would best adjust this system for non-identical goods.

------
steve19
This misses the point. All large DoD contract are usually followed by a
lawsuit from the loser. I have seen this happens so many times. If MSFT lost,
they would have probably sued.

~~~
pnw_hazor
Yes, it is normal. Even small government RFP contracts often have do-overs
when losers challenge the results.

I remember when Boeing first was awarded the US Air Force tanker contract. It
was soon rescinded for, among other things, fraud. They won the project again
the second time around.

Recently, the US Air Force has refused delivery of the tankers because of
manufacturing flaws.

[https://en.wikipedia.org/wiki/Darleen_Druyun](https://en.wikipedia.org/wiki/Darleen_Druyun)

~~~
Gwypaas
More complicated than that. Northrop Grumman and EADS/Airbus in a joint bid
won with a more capable platform, it was then redone due to Boeing protesting.
In the redo Boeing won.

Comparatively the A330 MRRT, which the first round winning bid was based on
entered service June 2011.

[https://en.wikipedia.org/wiki/KC-X](https://en.wikipedia.org/wiki/KC-X)

------
marzell
JEDI aside, I feel like Azure has grown in leaps and bounds... meanwhile AWS
has rested on its laurels because they were the first major cloud and so many
people adopted them early and either are stuck or in denial about where Azure
is at. Even Microsoft shops that would benefit from tighter integrations and
quicker feature releases seem to only really consider Azure an afterthought
and will use GCP for specialty cases in lieu of AWS.

I'm not trying to be a fanboy for MS, but I've found Azure much easier to
adopt personally, and their tooling especially around databases can work
really well. With AWS I feel like with every service I have to try out 3 or 4
third party tools for development which causes a ton of overhead and risk of
using a tool that changes direction or stops meaningful development. Whenever
I try to challenge the status quo people at work react like I'm an idiot.
Although, I'm not suggesting to a heavily-invested org that they should switch
clouds, but just asking questions like why we are heavily using RDS SQL Server
when Azure SQL-whatever-version-you-want would work even better and often
cheaper.

~~~
rpedela
I will buy SQL Server specifically, but if you are using MySQL or Postgres
then AWS is still the clear winner in my book. RDS is great and Aurora is even
better, and serverless...wow. Both Azure's and GCP's managed database
offerings don't match up if using MySQL or Postgres.

~~~
kevsim
How does RDS Postgres beat GCP hosted Postgres? Genuinely curious as we're
running on GCP and I'm wondering what we're missing out on.

~~~
rpedela
Turnaround time for supporting the latest version on RDS is faster, and RDS
supports more extensions. Then if you need to scale you have Aurora.

------
gaukes
> Even if you believe that Amazon may have started as the front runner, it’s
> clear our team worked hard to catch up and surpass them by investing in our
> technology and listening to the DoD.

Is MSFT actually ahead?

~~~
toomuchtodo
Define "ahead". Is AWS cutting edge? Maybe, but does your business need
cutting edge? Likely not. I see an enormous shift in the market towards Azure
from clients of all sizes, for a variety of reasons (cost, married to
AD/O365/etc, not wanting to give a competitor [Amazon] dollars). Azure
definitely has the momentum, it's their race to lose against AWS.

Disclaimer: Thoughts and opinions my own, not that of any employer past,
current, or future.

~~~
thisisnico
Microsoft can offer fully-integrated solutions with their already incredibly
popular software. So that's a distinct advantage.

~~~
toomuchtodo
Azure is less friendly as a technology practitioner (compared to working with
AWS), but I fully appreciate the value you describe. Does AWS have Active
Directory as a first class citizen? Office 365? Outlook/Exchange? No.

~~~
chucky_z
AWS does offer AD as a first class citizen... More than Azure.

AzureAD is _not_ Active Directory, and unless something has changed a lot in
the last year (maybe it has?), Azure does not offer anything that looks,
smells, and feels like on-prem AD in the cloud.

~~~
jedieaston
Azure Active Directory Domain Services is full-fat AD, but they market it
towards only using it for services in Azure. But you can set up a VPN from
Azure to join on-prem stuff (or to replicate existing AD to Azure).

[https://docs.microsoft.com/en-us/azure/active-directory-
doma...](https://docs.microsoft.com/en-us/azure/active-directory-domain-
services/overview)

~~~
chucky_z
That's good to hear! I really wanted "hosted AD" from a cloud a few years ago,
and Azure definitely did not offer this... or they marketed it so poorly I
could not find it anywhere. :(

AWS has straight up guides for do's/dont's, and various ways to integrate
their AD service with yours, including multiple scenarios such as running them
as the masters of the forest, with read-only's on-site, and vice-versa.

------
bid_high
"Microsoft won the JEDI contract because the Department of Defense found that
we offered “significantly superior” technology at a better price."

Umm.. what? Are they mentally impaired?

I recently tried doing something very simple - use the QnA Maker. You should
check it out for yourself - the number of clicks needed to do something as
simple as this makes me question all the comments I see these days that say
"Azure is as good as AWS".

No, it is not. It is a lot more complex for simple tasks, and looks like it
has been assembled together by a bunch of monkeys.

------
sbussard
I get the feeling that unless Amazon finds some integrity they will not last
long as a company. If you read Blind, they're the company that everyone loves
to hate - even their own employees.

------
thaumasiotes
> there is a very specific issue before the court at the moment. It may seem
> arcane and procedural, but the back-and-forth arguments between Amazon and
> the government raise a key question of principle and fairness that should
> matter to us all. Namely, should a company—like Amazon—that bid high and
> lost, now get a do-over, especially now—as the IG’s report makes
> clear—Amazon received additional proprietary information about Microsoft’s
> bid that it should never have had.

Actually, I don't really see the problem. There are two hypothetical models:

1\. Everyone gets to bid for the work once, and if they get it wrong, too bad
for them. What's right and what's wrong? Depends on your point of view. What
matters is that everyone got the same single chance to bid for a government
contract.

2\. Everyone bids for the contract. If their bid isn't being accepted, they're
free to adjust it. What matters is what the terms ultimately are, not what
they were at the start of bidding.

You may recognize that second model as the normal way everything is sold
everywhere. What's supposed to be wrong with Amazon quoting a price for
something, not getting a sale, and then lowering the price? We should hope
they do, and that Microsoft responds by lowering _their_ price even more.

~~~
partiallypro
Isn't the point though that Amazon knew about Microsoft's bid and other
proprietary elements and STILL bid high (while Microsoft was blind to
Amazon's?) They already had the advantage of information. #2 has already
effectively happened.

~~~
belltaco
I don't think Amazon knew about Microsoft's bid before the result was
announced. Looks like the DoD folks did not redact a bunch of things properly
while disclosing the winner information to Amazon.

------
Rafuino
"Much of the $1 billion (USD) we spend on security each year goes toward
Azure. Even if you believe that Amazon may have started as the front runner,
it’s clear our team worked hard to catch up and surpass them by investing in
our technology and listening to the DoD." How much does Amazon spend as a
company on "security" and how much of it goes to AWS, specifically?
Interesting talking point, but worthless without a real comparison.

Also, "we delivered new innovations including native edge devices that can
withstand the challenging environments in which the DoD operates." What the
heck is a "native edge device"? Is it a server hosted on the back of a drone?
Is it fortified compute hosted in a storage container in a forward operating
base? Is it just Azure Stack HCI on a warship? Really interested in that one.

------
acruns
This is SOP for a contract like this. I worked in this field for over a decade
before I went back to straight consulting. Helping or ever writing a RFP / RFI
/ proposal for a customer is not unheard of. I was given the opportunity to
provide input on more than one occasion and would certainly include
requirements I knew competitors could not functionally meet, in esence
eliminating all other competitors. They could respond but when the technical
team members meet with project sponsors and there is a big red square on the
scorecard in the competitors column indicating they can't meet a requirement
what is a SVP going to say? 'We don't need that'? They aren't technical and
even if they ask about it we clearly have internal support for our product and
can count on the technical team explaining why our feature is a requirement.
(We just so happen to have the best product so this wasn't much of stretch.)
The only difference between the private sector and gov is we can't take them
out to a $3000 dinner to discuss the requirements before they submit them. As
you can tell, this is a "bit" sleazy, while still mostly truthful we are
clearly trying to influence the outcome in our favor.

Having worked with the OIG (office inspector general), more than one of them,
they are as much a political animal as any other office in DC, more so in lots
of ways, so getting a report from them that says what you want is just a
matter of phone calls and dinners with the right ppl.

AWS got played, plain and simple. They thought they were going to win and
probably didn't do as mush as they should have to make sure they could win,
and at the same time underestimated Microsoft. Just bc Azure was new to the
DOD doesn't mean its new to the feds, I worked on several projects in AZ with
the feds, and MSFT is not new to DC, they have been playing in DC politics for
decades, and doing so very successfully. Which I am guessing from my outside
view was AWS / Jeff's mistake. Buying a mansion and hosting partys in DC and a
amateur move. There are a lot of very powerful ppl in DC that are former MSFT
employees. It is very common practice to move from MSFT's fed teams to a
fairly high position in a fed agency for your 20 years to get you retirement
plan completed.

------
zimbatm
Does anyone know what the nature of that proprietary information is?

------
tomohawk
The DOD made a big mistake here. They should have let several cloud contracts,
or a contract that enables use of diverse cloud providers.

Instead, they made a contract that is too big to lose.

------
jeffrallen
Two ugly gorillas fighting for the bananas held out by a war monger. Whatever.

------
mrslave
When losing a deal worth $1 billion/year for 10 years (gross, of course) the
right course of action is to sue the customer, hoping to then win them as a
customer.

One rule for the rulers and another for the ruled.

------
jsnider3
It lost because Trump hates Jeff Bezos for some reason.

~~~
krapp
>It lost because Trump hates Jeff Bezos for some reason.

Bezos is a Democrat and owner of the Washington Post, a paper which has been
openly critical of Trump's administration.

~~~
jsnider3
Bezos is not a Democrat, but yes WaPo like all reputable journalists has been
critical of Trump.

------
smitty1e
No. The government should have multiple cloud providers.

~~~
Ericson2314
No. They should run almost everything in-house so it can be properly
integrated.

~~~
chadcmulligan
Isn't the usual business of government to rotate every 5-10 years?

\- In house is the way to go!

\- No the pervious administration was wrong - outsourcing is the way to go

Lather, rinse, repeat

~~~
Ericson2314
With anything relating to advance technology I think the systematic
outsourcing has been prevalent since at least WWII.

------
voz_
Good writeup. Looks like a very interesting case. The more I read about
Amazon, the more I detest them.

------
mullingitover
Command+F 'Trump' -> 0 results

They seem to be ignoring the massive elephant in the room, where there was
political intrigue and a personal vendetta interfering in what's supposed to
be an apolitical process[1].

> "I'm getting tremendous complaints about the contract with the Pentagon and
> with Amazon; they're saying it wasn't competitively bid," Trump told
> reporters on July 18. "I will be asking them to take a look at it very
> closely to see what's going on because I have had very few things where
> there's been such complaining."

The fact that DoD officials were gagged from providing truthful testimony
should automatically result in the results being thrown out. They wouldn't be
gagged if they were going to say something helpful to Microsoft.

[1] [https://www.npr.org/2019/08/01/747374991/pentagon-
pauses-10-...](https://www.npr.org/2019/08/01/747374991/pentagon-
pauses-10-billion-cloud-contract-after-months-of-controversy)

