Trump holds up Amazon’s huge Pentagon contract

The White House has instructed newly installed Defense Secretary Mark Esper to re-examine the awarding of the military’s massive cloud-computing contract because of concern that the bid would go to Amazon, officials close to the decision-making process said.

The 11th-hour Oval Office intervention comes weeks before the winning bid was expected to be announced and has left a major military priority up in the air, said the officials, who spoke on the condition of anonymity to discuss the closed-door process freely.

As recently as Sunday, the Defense Department defended its plan to move ahead with a single company for what is known as the Joint Enterprise Defense Infrastructure, a $10 billion contract that would be one of the government’s most expensive information technology procurements ever.

No decision has been made, the officials said, but some officials said the contract could be awarded to more than one company.

President Donald Trump’s directive represents a departure from what is usually a scripted bureaucratic process. Trump has often spoken out against Amazon and its chief executive, Jeff Bezos; at times, Trump has conflated Bezos’ ownership of The Washington Post with Amazon’s interests.

Amazon and the Pentagon did not immediately return a request for comment.

Giving the contract to more than one company would be welcomed by Oracle and IBM. Their businesses are threatened by Amazon, and they have sued in vain to block the award. The Pentagon has said that only Amazon and Microsoft meet the minimum requirements for JEDI.

Oracle has lobbied Trump aggressively on the matter, hoping to appeal to his animosity toward Amazon and former Defense Secretary Jim Mattis, who angered the president when he resigned last year over the administration’s foreign policies. Oracle Executive Vice President Ken Glueck, who runs the company’s policy shop in Washington, said he created a colorful flow chart labeled “A Conspiracy To Create A Ten Year DOD Cloud Monopoly” that portrayed connections between Amazon executives, Mattis and officials from the Obama administration. That graphic made it to Trump’s desk and led to a discussion between the president and his aides, people familiar with the matter said.

In April of last year, Oracle CO-CEO Safra Catz also raised the issue directly with Trump at a dinner at the White House.

Last month, the president told reporters during a news conference that he had asked aides to investigate the JEDI contract.

“I’m getting tremendous complaints about the contract with the Pentagon and with Amazon ... they’re saying it wasn’t competitively bid,” Trump said on July 18.