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Pentagon Goes Winner-Take-All for Cloud Award Worth Billions

  • Microsoft, IBM criticize government’s sole-source stance
  • Amazon seen as favorite for multibillion-dollar contract
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Photographer: Bill Clark/CQ-Roll Call Group via Getty Images

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The Pentagon opened a winner-take-all competition Wednesday for a multibillion-dollar cloud services contract, dismaying Microsoft Corp., International Business Machines Corp. and industry groups representing rivals such as Oracle Corp., which worry the move will favor Amazon.com Inc.

While companies jockeying for a piece of the business pushed for the use of multiple cloud providers, the Pentagon announced its decision to go with a single company. The department already has difficulty moving information, particularly to the battlefield, and using multiple clouds would “exponentially increase the complexity,” Tim Van Name, deputy director of the ‎Defense Digital Service, said on a call with reporters.