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By Nick Wakeman

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Nick Wakeman

JEDI cloud procurement looks back on track

Defense Secretary Mark Esper’s announcement today that he will remove himself from the JEDI cloud procurement decision contains a second, and maybe bigger, significant piece of news than the fact one of his son works for a company that bid on the contract.

The JEDI contract is back on. It’s not being cancelled. After much political wrangling and presidential bluster, the contract to acquire a commercial cloud computing infrastructure is back in the hands of career acquisition professionals.

Esper delayed the award of this $10 billion contract after he was sworn in as defense secretary in late July. The cloud infrastructure contract has been controversial because of the single award strategy that the Defense Department is pursuing.

Oracle also continues to pursue a protest in the judiciary to stop the contract. Oracle claims there are conflicts of interest involving Amazon Web Services and that the single-award approach violates federal law. The case is now before the Court of Appeals for the Federal Circuit. Oracle lost its protests with the Government Accountability Office and then at the U.S. Court of Federal Claims.

IBM was one of four original bidders on the contract, but was eliminated from the competition along with Oracle through a downselect in April. It is now in a run-off between AWS and Microsoft. All bids for JEDI were due to the department in October of last year.

Esper’s statement says that he has had several briefings to get an understanding of the contract and other cloud options available to DOD.

He said he will no longer participate in the JEDI procurement because one of his sons works for “one of the original contract applicants.”

DOD's statement said Esper was not legally required to remove himself from the process, but did so out of an abundance of caution and to remove any concerns about his impartiality.

Deputy Defense Secretary David Norquist is overseeing the process.

Esper’s son, Luke, works for IBM as a digital strategy consultant. He joined the company in February of this year, according to his LinkedIn profile.

That means Luke Esper joined IBM five months after bids were due for JEDI and five months before Esper was sworn in as defense secretary. Esper was acting secretary for one month prior to his swearing in after then-acting Defense Secretary Patrick Shanahan withdrew from the nomination process and left the Pentagon.

An IBM spokesman said Luke Esper's role with the company is unrelated to IBM's pursuit of JEDI.

The expectation was that the JEDI award was imminent when Esper put the brakes on the process this summer. So the question now is how quickly will DOD make an award?

Could we see something before the end of the year? Stay tuned.

Posted by Nick Wakeman on Oct 22, 2019 at 10:00 AM

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