recommended reading

Amazon Prevails in CIA Cloud Suit

Michel Spingler/AP

This story has been updated to add details of Judge Wheeler's order. It will be updated again when a complete ruling is posted.

Amazon has won the latest round in a battle with IBM to build a massive computer cloud for intelligence agencies.

Judge Thomas Wheeler of the U.S. Court  of Federal Claims ruled in Amazon’s favor after oral arguments held behind closed doors on Monday. The ruling was in favor of Amazon’s motion for judgment on the administrative record, which means Wheeler concluded there was sufficient evidence in Amazon’s favor that it was not worth proceeding with a trial.

Judge Wheeler ordered that Amazon may immediately re-start work on the CIA contract, according to a written record of his order from the bench. A more detailed written order will follow shortly, according to the court docket. 

Amazon filed suit against the government after the CIA first awarded and then yanked a $600 million contract to build a computer cloud that could be used across the intelligence community. IBM challenged that contract at the Government Accountability Office, which concluded the CIA gave Amazon an unfair advantage after the cloud deal was signed.

IBM intervened in the federal court case and filed several motions, mostly under seal. The company told Federal Computer Week on Monday it planned to appeal Judge Wheeler’s ruling. The U.S. Court of Appeals would likely be the last stop for the contract dispute.

IBM has called Amazon an upstart in the government cloud arena and said the Web company is unprepared for classified government work. In court filings, Amazon called IBM a “late entrant” to cloud computing.

In its ruling, GAO found the CIA gave Amazon an unfair advantage because it agreed to modify some terms of the cloud contract after it had already been awarded. Notably, the agency agreed to weaken a requirement that all software in its cloud be verifiably free from computer viruses that might let unauthorized people see intelligence data. Amazon asked that it only be required to vouch for software it had built itself, not for third party and open source software.

In the first round of cloud solicitations, Amazon’s bid came in at $148 million and was rated low-risk by the CIA, according to a redacted version of Amazon’s lawsuit. The IBM proposal came in at $94 million and was graded high risk by the CIA, the lawsuit states. Both companies have re-bid on the contract, though that re-bidding process may now be halted.

This story has been corrected to accurately state the value of the Amazon contract. 

Get the Nextgov iPhone app to keep up with government technology news.

Threatwatch Alert

Thousands of cyber attacks occur each day

See the latest threats


Close [ x ] More from Nextgov

Thank you for subscribing to newsletters from
We think these reports might interest you:

  • It’s Time for the Federal Government to Embrace Wireless and Mobility

    The United States has turned a corner on the adoption of mobile phones, tablets and other smart devices, outpacing traditional desktop and laptop sales by a wide margin. This issue brief discusses the state of wireless and mobility in federal government and outlines why now is the time to embrace these technologies in government.

  • Featured Content from RSA Conference: Dissed by NIST

    Learn more about the latest draft of the U.S. National Institute of Standards and Technology guidance document on authentication and lifecycle management.

  • A New Security Architecture for Federal Networks

    Federal government networks are under constant attack, and the number of those attacks is increasing. This issue brief discusses today's threats and a new model for the future.

  • Going Agile:Revolutionizing Federal Digital Services Delivery

    Here’s one indication that times have changed: Harriet Tubman is going to be the next face of the twenty dollar bill. Another sign of change? The way in which the federal government arrived at that decision.

  • Software-Defined Networking

    So many demands are being placed on federal information technology networks, which must handle vast amounts of data, accommodate voice and video, and cope with a multitude of highly connected devices while keeping government information secure from cyber threats. This issue brief discusses the state of SDN in the federal government and the path forward.

  • The New IP: Moving Government Agencies Toward the Network of The Future

    Federal IT managers are looking to modernize legacy network infrastructures that are taxed by growing demands from mobile devices, video, vast amounts of data, and more. This issue brief discusses the federal government network landscape, as well as market, financial force drivers for network modernization.


When you download a report, your information may be shared with the underwriters of that document.