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JEDI may be Microsoft's key to global government market

JEDI is a huge contract on its own, but Microsoft also apparently sees its win of the Defense Department's cloud infrastructure contract as a launching pad for similar projects with international governments.

CNBC is reporting that Microsoft is signing deals with other governments looking for cloud infrastructure services.

Microsoft’s comment to the news outlet emphasized that the company has worked with global governments for four decades. One implication here is that as its cloud market share grows, it will sell those services internationally. That should be no surprise.

Amazon Web Services still holds the global lead with 47 percent of the cloud market in 2019, CNBC reports. Microsoft stands at 13 percent. AWS of course is embroiled in a legal battle after losing JEDI to Microsoft.

CNBC also quotes an equity research analyst's estimate that Microsoft’s Azure cloud offering had $5.93 billion in second quarter revenue, or 16 percent of Microsoft’s total sales. AWS’ second quarter revenue was $10.8 billion.

The MAzure number also doesn’t include its software-as-a-service offerings such as Microsoft 360.

Some of Microsoft’s international customers for Azure include New Zealand’s firefighting agency, France’s space agency and the Canada Mortgage and Housing Corp., according to CNBC.

If Microsoft hangs on to JEDI, the company can tout DOD as a high-profile customer in pursuit of more opportunities. Even if the award shifts to AWS (which would bring another protest fight, I’m sure), Microsoft has more than proven it belongs in the cloud conversation alongside AWS.

AWS’ court case protesting the award to Microsoft remains on hold as the U.S. Court of Federal Claims gave DOD more time to re-examine the award. The deadline is now Sept. 16 for DOD to either stick with Microsoft or switch to AWS.

This article first appeared on Washington Technology, a Defense Systems partner site.

About the Author

Nick Wakeman is the editor-in-chief of Washington Technology. Follow him on Twitter: @nick_wakeman.

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