The Strategist

Pentagon and Microsoft sign $ 1.76 billion worth contract

01/16/2019 - 13:48

In January 2019, Microsoft signed another contract with the US Department of Defense. This time it is about providing the Pentagon with corporate services for five years (until January 10, 2024) in the amount of $ 1.76 billion.

mindfrieze via flickr
mindfrieze via flickr
Microsoft has entered into a major contract with the US Department of Defense, reports Reuters. The contract provides for the delivery of corporate services to the Pentagon over the next five years (until January 2024). It is not specified what kind of services will be delivered to the Department.

The contract for the provision of cloud services to the Department of Defense (DoD), the US Coast Guard and the intelligence community extends to "support tools, access to knowledge bases, problem solving, and custom-made changes to Microsoft source code when applicable," the DoD statement said.

According to The Register, Microsoft will receive almost $ 2 billion from the Pentagon right away. The funds will be distributed to individual orders and transferred in batches during the term of the agreement.

Having concluded and implemented several large contracts with the Pentagon, Microsoft expects to sign another large contract. The US Department of Defense is expected to choose a cloud provider for the Joint Enterprise Defense Infrastructure (JEDI) project. The winner will host the main part of the Pentagon’s IT infrastructure and help create a large-scale cloud computing system to develop new types of weapons and store secret information.

The application for the development of JEDI was filed in March 2018, and until October 2018, Google was the favorite. Eventually, the Internet giant had to withdraw its candidacy under pressure from employees who did not want to work for the military.

Amazon is now considered the new main contender, but Microsoft intends to defend the right to develop JEDI. The contract amount will be $ 10 billion, which is five times more than Microsoft will receive under the new contract with the Pentagon over the next five years.

According to Charles King, an analyst from Pund-IT, Microsoft is quite capable of obtaining permission to work with data from the DISA Level 6 privacy level in the current quarter. In addition, he believes that many processes will become simpler if one provider will be responsible for cloud and on-site services.

By the way, in June, Google refused another $ 250 million agreement with the Pentagon: the corporation was developing the Maven project for the military, which is a surveillance system with a Google Earth-style interface that allows clicking on any objects in sight and get comprehensive information on them.

This is not the first time when Microsoft cooperates with the Pentagon. So, in November 2018, a contract was signed for $ 480 million, under the terms of which HoloLens augmented reality glasses began to be used for training fighters and in military operations. Microsoft pledged to supply the US Army with up to 100,000 HoloLens headsets, with which the military would be able to thoroughly rehearse the conduct of complex special operations in enemy territory.


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