The United States Department of Defense has awarded Microsoft with an enterprise general-purpose cloud contract called Joint Enterprise Defense Infrastructure (JEDI). The base contract period will last for two years with a $1 million guarantee but spending is likely to increase to around $210 million in those two years, driven by user adoption of the product.
The DOD’s decision to find a firm to offer the contract to has been going on for quite a while now, with Microsoft and Amazon being the only contenders for the contract since at least October 2018. The process has not been smooth sailing with both IBM and Oracle raising issues over the matter. Despite this, the DOD said in its statement that all of the firms who partook were “treated fairly and evaluated consistently”.
Commenting on the news, DOD Chief Information Officer, Dana Deasy, said:
“The National Defense Strategy dictates that we must improve the speed and effectiveness with which we develop and deploy modernized technical capabilities to our women and men in uniform. The DOD Digital Modernization Strategy was created to support this imperative. This award is an important step in execution of the Digital Modernization Strategy.”
The DOD’s JEDI contract is part of a wider technology overhaul to modernize systems. With JEDI, Microsoft's aim will now be to deliver a product that gives the military better access to data and the cloud from battlefields and other remote areas. On the back of the news, Microsoft’s stock price has risen by more than 3% in after-hours trading.