A PYMNTS Company

US: Antitrust critics ear winner-take-all DOD cloud contract

 |  March 11, 2018

According to The Hill, antitrust critics fear that a winner-take-all contract for the Defense Department’s (DOD) cloud computing needs could help tech giant Amazon corner the government contract market even further.

The Pentagon opened a winner-take-all competition Wednesday, March 7, for a multibillion-dollar cloud services contract, dismaying Microsoft., International Business Machines (IBM) and industry groups representing rivals such as Oracle, which worry the move will favor Amazon.com.

Amazon’s competitors like IBM and Microsoft have been pushing for a multi-party contract that would split cloud-computing services between several companies. They argue that leaving the contract in the hands of a single provider unnecessarily increases cybersecurity risks.

“It’s certainly an indication that Amazon has enormous political power,” said Stacy Mitchell of the Institute for Local Self-Reliance, a research group that advocates for local businesses and tracks Amazon’s movements in government. “They have translated their corporate power and wealth into political power.”

Companies have been frustrated by what they see as procurement bias towards Amazon have also slammed the decision.

IBM called the move “flawed,” while Microsoft said it was “disappointed.”

The tech companies have voiced their frustration through their trade association, the Information Technology Industry Council (ITI), which also represents Amazon.

“We are concerned with reports regarding a single-award cloud contract for the Department Enterprise, as well as possibly canceling all awarded DOD cloud contracts leaving the Department with only one cloud solution,” the ITI wrote in a November letter to the Pentagon that was obtained by The Hill.

Full Content: The Hill

Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.