Business / Tech

New U.S. defense chief insists he wasn't told to review $10 billion JEDI cloud-computing contract

Bloomberg

Defense Secretary Mark Esper said he heard questions from people in the White House about a Pentagon cloud-computing contract valued at as much as $10 billion, but wasn’t directed to order the review that’s under way.

President Donald Trump stunned technology companies, the Defense Department and lawmakers in July when he openly questioned whether the pending contract is being competitively bid amid concern the deal favors Amazon.com Inc.’s cloud unit.

Esper, who has recently taken over the department, ordered the review of the contract for the Joint Enterprise Defense Infrastructure cloud, also known as JEDI, on Aug. 1.

“I’m looking at all the concerns I’ve heard from members of Congress, both parties, both sides of the Hill,” Esper told reporters over the weekend while flying to Australia from Thailand, according to a transcript released by the department. “I’ve heard from people from the White House as well.”

Even before Trump weighed in, several lawmakers had questioned the contract requirements, including Republican Sens. Ron Johnson of Wisconsin and Marco Rubio of Florida. Trump also said he’d heard complaints from companies such as Microsoft Corp., the No. 2 contender, and Oracle Corp., which was eliminated from the competition earlier this year.

The top Democrat on the Senate Intelligence Committee, Mark Warner of Virginia, said in a tweet on Friday that the president shouldn’t use his power to hurt his media critics, in an apparent reference to Amazon founder Jeff Bezos, who also owns the Washington Post.

Esper said he wanted to balance the capabilities for artificial intelligence that the cloud project would bring while ensuring “that the process was done fairly, properly, it was competitively bid, and all those things, because I have a responsibility to the taxpayers to be a good steward.”

He said he would take the same action for any contract that attracted so much “consternation.”

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