Amazon is protesting the awarding of a $25m contract to russian owner of Google Sergey Brin

Amazon is protesting the awarding of a $25m contract to russian owner of Google Sergey Brin

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By Allan Smith, businessinsider.com

 

 

The company filed the protest this week.

The protest signals Amazon would contest a Pentagon contract worth billions if President Donald Trump worked to interfere with the bidding process.

Amazon Web Services filed a protest this week that indicates it would contest any meddling by President Donald Trump into a coming Pentagon contract.

Amazon Web Services filed a protest with the Government Accountability Office on Tuesday to contest the awarding of a military contract to Google. The contract, worth less than $25 million, will provide West Point with Google's G Suite Enterprise. Amazon protested the awarding of the contract, claiming the bid process was unfair, because West Point specified the use of the Google product in its task order.

Certainly, if Amazon would petition the government over a contract worth less than $25 million, claiming the process to be unfair, it wouldn't have qualms over protesting the loss of a contract worth billions if Trump were to meddle in the process.

"Depending on the facts and what happens going forward, I think he may have at least given Amazon a possible basis upon which to challenge the award of the contract, if they don't have get it," Larry Noble, the senior director and general counsel of the Campaign Legal Center, told Business Insider. "Amazon has rights in the bidding process and he should not take steps to interfere. He has already raised an appearance issue by his constant attacks on the Amazon."

'I can't imagine any possible way that the deal could be stopped'

As Business Insider reported earlier this week, Amazon is considered a near lock to land the Pentagon contract, which aims to provide the military with cloud-computing services. The Pentagon is scheduled to award the contract by September.

Business Insider's Hayley Peterson reported that some Pentagon agencies were so sure Amazon would secure the contract that they were preparing to transition to GovCloud, the Amazon product designed for government use.

"I can't imagine any possible way that the deal could be stopped," one source told Business Insider.

Another source, however, said it was too soon to declare Amazon the victor. Heather Babb, a Pentagon spokeswoman, told Business Insider that the competition for the contract would be "full and open."

Amazon's status as the perceived frontrunner for the contract has been shaped largely by its $600 million deal with the CIA in 2013, which showed the company could manage and secure sensitive information and provided it a leg up on obtaining top-level security credentials.

Draft requirements released by the Pentagon for the project - called the Joint Enterprise Defense Infrastructure, or JEDI, cloud initiative - say bidders must be able to obtain those security credentials within nine months of winning the contract. As of now, Amazon Web Services is the only potential vendor that meets that requirement.

Additionally, the Pentagon recently agreed to a deal worth up to $65 million with a company that partners with Amazon Web Services to provide cloud services to the US Transportation Command. Oracle, which is locked in competition with Amazon for the larger JEDI contract, is already protesting that decision with the GAO.

The Pentagon intends to award the multiyear contract to one vendor.

Trump is hearing about the Pentagon contract

Oracle's co-CEO Safra Catz reportedly tried to sway Trump on the contract earlier this week when she dined with the president.

Catz told Trump the bidding process was designed so that Amazon could win the bid, people familiar with the conversation told Bloomberg. But Trump apparently did not give any indication he would put his thumb on the scale. The White House press secretary, Sarah Huckabee Sanders, said Wednesday that Trump was not involved with the bidding process.

But some of Amazon's other opponents have clearly tried to nudge Trump toward meddling in the deal. The group Less Government last week placed an ad in the New York Post - known to be one of Trump's favorite publications - highlighting the possible deal. Addressed directly to Trump, the ad warns: "Your Defense Department is set to award a no-bid, ten-year contract for all its IT infrastructure to Administration-enemy Jeff Bezos' Amazon."

The episode comes amid Trump's war of words with Amazon. Trump has criticized Amazon for well more than a year, often tying the company to The Washington Post, owned by Amazon's founder and CEO, Jeff Bezos.

Multiple news outlets have reported that Trump is trying to figure out what he could do to Amazon, such as changing its tax status or using antitrust laws against the company, and some have highlighted the Pentagon contract as a way for the president to take a shot.

Whoever loses out on the bid, whether it be Amazon, Oracle, or another vendor, will in all likelihood protest the decision with the GAO.

The GAO, in deciding such protests, considers whether the federal agency under question complied with statutes and regulations regarding government contracts. If the office, which is housed under Congress, decides to take up a protest, it must issue a decision within 100 days of filing. A decision reached by the GAO serves as a recommendation to the federal agency on what is the appropriate corrective action, and federal agencies almost always follow that recommendation.