Amazon, Microsoft finalists for $10 billion government cloud contract

Andrew Jassy, chief executive officer of web services for Amazon.com Inc., speaks during the 2019 CERAWeek by IHS Markit conference in Houston, Texas, U.S., on Monday, March 11, 2019.

F. Carter Smith | Bloomberg | Getty Images

Andrew Jassy, chief executive officer of web services for Amazon.com Inc., speaks during the 2019 CERAWeek by IHS Markit conference in Houston, Texas, U.S., on Monday, March 11, 2019.

IBM in addition to Oracle have been ruled out for a U.S. Defense Department contract for cloud computing services that will could be worth as much as $10 billion over the course of a decade.

The deal, known as JEDI, could have been a boon to either of those technology companies, which trail Amazon in addition to Microsoft inside public cloud market. Business coming from the CIA inside United States has helped Amazon Web Services in its effort to get more companies using its services, in addition to the brand-new Defense deal could be more valuable.

AWS in addition to Microsoft are the only companies that will meet the minimum requirements for the contract, Defense Department spokesperson Elissa Smith told CNBC in an email on Thursday. The brand-new York Times first reported the decision on Wednesday.

The Defense Department was supposed to select the winner in September 2018 nevertheless delayed the process. at This specific point the winner will be announced as soon as July 2019, Smith wrote inside email.

“The scope in addition to complexity of DOD’s mission requires multiple clouds coming from multiple vendors. JEDI is actually one element of DOD’s overall multi-cloud strategy in addition to part of larger efforts to modernize information technology across the DOD enterprise,” Smith wrote.

Both IBM in addition to Oracle previously protested the request for proposal for the contract. Those protests were dismissed.

AWS had revenue exceeding $7.4 billion inside fourth quarter. Microsoft does not disclose revenue for its Azure cloud, nevertheless in a note distributed to clients earlier This specific month, Morgan Stanley analysts led by Keith Weiss estimated that will Azure gave Microsoft more than $3 billion in revenue inside fourth quarter.

The Pentagon has allocated $61.9 million for JEDI inside budget for the 2020 fiscal year.

IBM, Microsoft in addition to Oracle declined to comment. Amazon didn’t respond to a request for comment.

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