Amazon must soon decide whether it will object to Pentagon's award of a $ 10 billion cloud computing contract to compete with Microsoft, with a possible complaint like the unusual attention given to the project by President Donald Trump.
Amazon was long believed to be the front runner in the competition for the huge military contract. Amazon Web Services division is well ahead of Microsoft's second place in cloud computing, and Amazon has experience handling highly classified government data. It survived previous legal challenges after the Department of Defense eliminated competing bidders Oracle and IBM and plundered the competition for the two tech giants in the Seattle area before choosing Microsoft last week.
The Pentagon was preparing to make its final decision when Trump publicly washed out the controversy in July, saying he had heard complaints about the process and that the administration would "take a very long look." He said others Companies told him the contract was "not competing." Specifically, Oracle had claimed that Pentagon officials unfairly favored Amazon for the winner-take-all contract.
Trump's comments were "inappropriate and improvident," though it would be a challenge for Amazon to prove that the White House exerted undue pressure in a way that made a difference, said Steven Schooner, a professor of procurement law at George Washington University.
Given the high stakes and Trump's familiar antipathy toward the company, Schooner said that Amazon may not have much to lose in choosing a fight.
Amazon did not return requests for comment on the next steps.
The clock is ticking now. Amazon has the right to ask the Pentagon to chart the company as to what led it to choose Microsoft instead.
The Pentagon declined to comment this week on the details of the debriefing process and whether it has already started. It has previously stated that the competition for the 10-year contract was fair and followed procurement guidelines.
Dana Deasy, Pentagon's acting chief information officer, reiterated that position in a Senate confirmation hearing Tuesday after Maine Sen. Angus King, an independent, asked Deasy if he could "categorically assure us" that Trump had no influence on the final disposition of the contract.
Deasy said that the procurement team was hilly and that he was sure that team members "who actually made the source selection" were not affected by the White House. The White House declined comment this week.
If Amazon is not happy with the government's explanation, it can file a formal protest with the government's accountability office, which then has 100 days to review the case. Alternatively, Amazon may resolve the dispute by taking it to the US Court of Federal Claims.
"If you are Amazon, you will get into some kind of discovery phase to evaluate whether it was political influence or not," said Mike Hettinger, a tech industry lobbyist focused on federal contracts not working for Amazon or competing bidders .
Hettinger expects the company to file some form of protest.
"Most people in the industry thought it was the Amazon to lose because of the technical superiority," he said. "Everyone has put a lot of emphasis into this, but it's obviously an important distinction."
Former federal contractor David Drabkin also said it made sense for Amazon to appeal, though he said he would be surprised if professional contractors were found to be unduly influenced by something Trump said or did.
"They are patriots," said Drabkin, who heads the government's contract adviser at Dixon Hughes Goodman. "It's not relevant to the decision they have to make about what represents the best value for the government."
The project, known as Joint Enterprise Defense Infrastructure, or JEDI, will store and process large amounts of classified data, allowing the US military to use artificial intelligence to speed up its war planning and combat capabilities.
Microsoft said it brought its "best efforts" to Pentagon's rigorous evaluations and appreciates that it was chosen. It is still in the final stages of getting accreditation required to handle the government's most sensitive classified data – something Amazon had already achieved.
"We are committed to meeting all of the requirements of JEDI," Toni Townes-Whitley, a Microsoft director, said in a statement Thursday.