{"id":111606,"date":"2020-04-15T22:25:32","date_gmt":"2020-04-15T22:25:32","guid":{"rendered":"https:\/\/news.microsoft.com\/?p=437132"},"modified":"2020-04-15T22:25:32","modified_gmt":"2020-04-15T22:25:32","slug":"it-bid-high-and-lost-should-amazon-be-allowed-a-do-over-on-jedi","status":"publish","type":"post","link":"https:\/\/sickgaming.net\/blog\/2020\/04\/15\/it-bid-high-and-lost-should-amazon-be-allowed-a-do-over-on-jedi\/","title":{"rendered":"It bid high and lost. Should Amazon be allowed a do-over on JEDI?"},"content":{"rendered":"
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Today the Inspector General for the Department of Defense released a report<\/a> into the DoD\u2019s handling of the JEDI contract. With this report and some legal milestones around the corner it is a good time to reflect on where we are in litigation on the award of the contract, and how we got here.<\/p>\n

For all of the heat and noise around this case, there is a very specific issue before the court at the moment. It may seem arcane and procedural, but the back-and-forth arguments between Amazon and the government raise a key question of principle and fairness that should matter to us all. Namely, should a company\u2014like Amazon\u2014that bid high and lost, now get a do-over, especially now\u2014as the IG\u2019s report makes clear\u2014Amazon received additional proprietary information about Microsoft\u2019s bid that it should never have had. That\u2019s what Amazon wants. The government rightly says no.<\/p>\n

A central premise of the federal procurement system is that \u201cfull and fair competition\u201c on a \u201clevel playing field\u201c means that competitors are asked to make their best bids without knowing what the other has bid or will bid. That principle ensures that companies seeking to do business with the federal government offer their best price from the beginning. They can\u2019t offer a higher price in the hope they\u2019ll win the bid anyway, and then turn around and ask to bid again if they lose. Amazon is not asking to be on a level playing field. It\u2019s arguing that the field be tilted in its favor.<\/p>\n

Microsoft won the JEDI contract because the Department of Defense found that we offered \u201csignificantly superior\u201d technology at a better price. Four months later, the Court stopped work on the contract based on an error the judge found in one part of the DoD\u2019s procurement process.  The DoD then filed a motion to suspend the litigation for 120 days so it can very specifically address the judge\u2019s concern\u2014but without allowing Amazon and Microsoft to revise their original pricing.<\/p>\n

That brings us to where we are today. The DoD is seeking to be responsive to the issue the Court raised in issuing the preliminary injunction. But that\u2019s not good enough for Amazon. Amazon doesn\u2019t want a solution that addresses the Court\u2019s concerns and sticks to the original pricing in the competitors\u2019 bids.  According to its brief, it wants no \u201cconstraint on the offerors\u2019 ability to revise their pricing.\u201d<\/p>\n

This, according to the government, is a \u201ca transparent effort to undercut Microsoft on price, now that [Amazon] has a target at which to aim.\u201d  Amazon dresses its argument in the language of fairness and level playing fields, but the government\u2019s brief looks right through it: \u201cThat AWS now regrets its pricing strategy is no reason to allow AWS a do-over, after it gained significant information about its competitor\u2019s pricing, enabling it to use the currently prevailing information asymmetry to underbid its competitor in an effort to secure the contract.\u201d<\/p>\n

But Amazon does not just want to re-do its pricing now that it has information about Microsoft\u2019s pricing. It wants the DoD to go back and broadly re-do its evaluation of many issues, hoping to rescue its losing proposal.  Amazon, as an unsuccessful bidder, lawfully received some information about Microsoft\u2019s winning price.  The Inspector General\u2019s report now reveals that Amazon also received Microsoft proprietary information it should not have received or used \u2014information that the IG states could potentially give it \u201can unfair advantage in the cloud services marketplace.\u201d  Now that Amazon has this retained knowledge of Microsoft\u2019s proprietary information, a complete re-do can only hurt Microsoft and benefit Amazon.<\/p>\n

We can all agree that bid protest cases, and the judges that preside over them, serve an important function in helping to ensure fair procurements. But Amazon\u2019s suggested approach \u2013 bid high, lose, try again \u2013 isn\u2019t fair.  It\u2019s the opposite.<\/p>\n

The JEDI procurement has lasted more than two years. The DoD reviewed our bid against eight distinct evaluation factors and 55 individual sub-factors. The department subjected our products and services to four individual test scenarios, which were composed of more than 78 individual steps. The result? We were rated equal or superior to Amazon in every evaluation factor.<\/p>\n

There is a simple explanation for Microsoft\u2019s victory \u2013 the strength of our technology, and our willingness to listen to and respond to our potential customers. More than 95 percent of Fortune 500 companies run Microsoft Azure. More than 10,000 government organizations are our customers. Much of the $1 billion (USD) we spend on security each year goes toward Azure. Even if you believe that Amazon may have started as the front runner, it\u2019s clear our team worked hard to catch up and surpass them by investing in our technology and listening to the DoD.<\/p>\n

What we learned and developed during the months leading up to the final proposal enabled us to better grasp the DoD\u2019s requirements and what they were looking for so we could adapt our approach to best meet the DoD\u2019s needs. Through the procurement process, we invested significant time and engineering resources into our products, we delivered new innovations including native edge devices that can withstand the challenging environments in which the DoD operates, and we demonstrated that we are capable of meeting their criteria at the best price point.<\/p>\n

Our commitment to the DoD runs deep, and we believe our nation\u2019s men and women in uniform deserve this technology now. As Microsoft President Brad Smith wrote<\/a> in October 2018, \u201cwe believe in the strong defense of the United States and we want the people who defend it to have access to the nation\u2019s best technology, including from Microsoft.\u201d That guiding principle remains true today.<\/p>\n

We are ready to help the DoD fulfill its important mission. Since we were awarded this contract, we\u2019ve met every deadline established by the DoD. We were ready to move the first DoD early adopter units to the cloud on schedule on February 14. We\u2019ll remain ready to serve the DoD as this process continues to move forward.<\/p>\n

Amazon would have you believe that it lost the award because of bias at the highest levels of government. But Amazon, alone, is responsible for the pricing it offered.  As the government explained in its brief: \u201cAWS and Microsoft each had a fair chance to build pricing for the entire procurement, based on their overall business pricing.\u201d  Amazon did build its pricing for the entire procurement, and it wasn\u2019t good enough to win.  And now it wants a re-do.  That\u2019s not good for our war-fighters.  That\u2019s not good for confidence in public procurement. That\u2019s not good for anybody but Amazon.<\/p>\n

Tags: Amazon<\/a>, Defense<\/a>, JEDI<\/a>, Microsoft Azure<\/a>, military<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Today the Inspector General for the Department of Defense released a report into the DoD\u2019s handling of the JEDI contract. With this report and some legal milestones around the corner it is a good time to reflect on where we are in litigation on the award of the contract, and how we got here. For […]<\/p>\n","protected":false},"author":2,"featured_media":111607,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[49],"tags":[152,50],"class_list":["post-111606","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-microsoft-news","tag-microsoft-on-the-issues","tag-recent-news"],"_links":{"self":[{"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/posts\/111606","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/comments?post=111606"}],"version-history":[{"count":0,"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/posts\/111606\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/media\/111607"}],"wp:attachment":[{"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/media?parent=111606"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/categories?post=111606"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/tags?post=111606"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}