Pentagon cancels $10bn cloud-computing deal with Microsoft, announces new contract

In its place, the Pentagon announced a new contract which is expected to include Amazon and other cloud companies such as Oracle or IBM.

While the Trump administration had wanted a single provider, the Biden administration has said that it will divide the project among multiple companies.

The Pentagon hopes to have the first awards for its new Joint Warfighter Cloud Capability by April 2022.

Microsoft said in a statement the company was confident it will "continue to be successful as the DoD selects partners for new work".

The contract which is now-called the Joint Enterprise Defense Infrastructure Cloud, was budgeted for as much as $10bn and part of a broader modernization of the Pentagon.

It was initially expected to be won by Amazon, the biggest cloud computing provider, but it was finally awarded to Microsoft in 2019 on claims that it gave “huge credibility” to the company, Reuters reported on Wednesday.

Amazon responded later in 2019 by filing a lawsuit against the decision from the Trump administration, alleging that the former president had pressured military officials to not award the contract the retail tech giant.

It also alleged that the Pentagon decision was full of "egregious errors," which it suggested were a result of "improper pressure from Trump."