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Oracle Files Protest Over Pentagon's $10 Bln JEDI Cloud Contract


Business software giant Oracle Corp. (ORCL) has filed a pre-award protest against the Pentagon's decision to award a multi-billion dollar cloud computing contract to a single company instead of allowing for multiple winners.

The Pentagon's Joint Enterprise Defense Infrastructure or JEDI cloud contract could be worth up to $10 billion over a decade if all options are exercised.

This is the first bid protest against the contract for which Amazon.com Inc (AMZN) is seen as a top contender. Amazon Web Services or AWS is the only company approved by the U.S. government to handle secret and top secret data.

In late July, the Defense Department officially began accepting proposals for the controversial contract, which will be awarded to a single cloud provider so as to enable the rapid adoption of technology.

Oracle filed its bid protest on Monday with the Government Accountability Office or GAO. A bid protest is a challenge to the terms of a solicitation or the award of a federal contract. The GAO, which adjudicates and decides these challenges, will issue a ruling on the protest by November 14.

"The technology industry is innovating around next generation cloud at an unprecedented pace and JEDI virtually assures DoD will be locked into legacy cloud for a decade or more. The single-award approach is contrary to industry's multi-cloud strategy, which promotes constant competition, fosters innovation and lowers prices," Oracle said in a statement.

Oracle will compete for the JEDI contract against rivals Amazon Web Services, Microsoft, IBM and Google.

In May, the GAO sided with Oracle after the company filed a protest against a $950 million cloud migration contract awarded by the Defense Department to Virginia-based REAN Cloud, which describes itself as an AWS Premier Consulting Partner. The Pentagon slashed the contract award to $65 million.

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