• 11 hours Legacy Automakers See Massive Spike In Sales
  • 1 day Tesla's Biggest Competitor Is Going Cobalt-Free
  • 2 days Stocks That Could Benefit From Biden’s $2.5 Trillion Infrastructure Plan
  • 4 days The Mafia Has Expanded Its Influencer Under COVID-19
  • 5 days How Fintech Will Get Skeptics Into Crypto
  • 6 days Monday Markets Rise On Stellar Jobs Report
  • 9 days Not Even Bribery Allegations Can Crush Cannabis Boom
  • 13 days Canada May Become Leader In Booming Battery Market
  • 14 days Nearly 42% Of All Amazon Reviews Are Fake
  • 15 days Kidnapping Is Big Business In Nigeria
  • 16 days COVID Fraud Amounts To Nearly $570M
  • 19 days Art Is Now An Algorithm
  • 20 days TikTok Threatens America, Tesla Threatens China
  • 20 days Small-Cap Energy Sectors With Big Upside
  • 24 days Coinbase Valued At $68 Billion Ahead Of IPO
  • 26 days 3 Stocks To Watch Amid AstraZeneca Covid Vaccine Snafu
  • 27 days Get Ready For First Tax Hike Since 1993
  • 30 days Tech Majors Bet Big On Clean Energy
  • 31 days Is This The Next Amazon Of Used Cars?
  • 32 days First Ever Tweet Attracts $2.5M Bid On Blockchain Platform
Mozilla vs DarkMatter: The Cyber Espionage End Game

Mozilla vs DarkMatter: The Cyber Espionage End Game

Firefox browser maker Mozilla is…

Uber To Offer On Demand Employment

Uber To Offer On Demand Employment

Uber is the de facto…

  1. Home
  2. Tech
  3. Internet

Cloud Heavyweights Battle For $10B Pentagon Prize

Cloud

For many years, the cloud quadrille of Amazon’s AWS, Microsoft’s Azure, Google Cloud and IBM SmartCloud has been engaging in rounds of fierce price wars in a bid to dominate both market share and mindshare. The cloud race has also frequently featured a healthy dose of ivory tower jousting and demagoguery.

But right now, the war is being fought on an entirely new front: to prevent a powerful rival from embarrassing its cloud competitors.

Specifically, nine public cloud vendors have set aside their rivalries to gang up against Amazon, which is looking like a shoo-in to win a massive $10 billion cloud contract by the Pentagon.

AWS, the largest and most feature-rich public cloud, is slated to be awarded a contract known as the Joint Enterprise Defense Infrastructure (JEDI).

Nine other vendors including Microsoft, IBM, Oracle, VMware, HP, Dell, General Dynamic’s CSRA unit, SAP, Red Hat are not happy with the single-source arrangement and are banding together to persuade the Pentagon to divvy up the spoils amongst several vendors.

It’s laughable that Microsoft and Oracle, two sworn arch enemies, are at the frontline in the battlefield, kicking and screaming the loudest.

Firing Blanks

The JEDI contract, due to be awarded in September, has been highly contentious for months.

The anti-Amazon crowd has joined ranks to woo the press and lobby legislators to support their cause. They have even gone as far as taking out ads in The New York Times, one of Trump’s favorite publications, complete with pictures of a grinning Jeff Bezos, Amazon’s CEO.

But so far they seem to be firing blanks. Related: Global Debt Is Weighing On Gold Prices

Although the House Budget Committee has yielded to their charm offensive and passed legislation to halt funding for JEDI if it awards the contract to a single vendor, the senate is having none of it and has stuck with the old version of the spending bill.

Maybe Amazon should now throw a counterpunch by publishing ads of a weeping Larry Ellison in the Washington Post (owned by Bezos).

Bragging Rights

From a casual glance, the stonewalling sounds like nothing more than a bad case of corporate sour grapes. After all, a contract of that magnitude seems beyond the pay grade of some companies on that list and they could simply end up being cannon fodder for the likes of Microsoft and Oracle.

Sure, $10 billion is a lot of money. But JEDI will likely be a long-term 7- to 10-year contract, meaning the amount will be amortized over the entire period.

For a company like Microsoft with cloud revenues approaching $20 billion and total revenues approaching $100 billion, an extra $2 billion or so every year will hardly budge the top line.

This is not just about money. To a large extent, it’s about winning the bragging rights in the hotly contested cloud wars.

AWS is already several times bigger than second-placed Azure, while the other contenders would need the Hubble telescope just to see it. Winning such a huge and important contract would not only allow AWS to gloat in front of its rivals for years, but it would improve it’s already admirable standing in the eyes of other clients, especially the heavily loaded ones.

Microsoft and Oracle et al are simply trying to prevent that from happening.

By Alex Kimani for Safehaven.com

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment