Microsoft Invades Amazon’s Turf in Spookville

An intelligence-community contract for cloud and AI services is just a prequel to the upcoming battle for the Pentagon’s massive cloud contract.

The U.S. intelligence community has inked a contract to expand its use of Microsoft Azure cloud services for government, which will better enable it to use a suite of “intelligent algorithms” — a deal that just might help the Seattle-based company in the looming fight for a truly massive Pentagon cloud award.

Dubbed Cognitive Services, these machine-learning tools can help identify objects in images, discriminate between speakers in audio, and even automatically detect  “emotional” states in video, according to Microsoft’s website, which says UPS uses them in a voice interface for its delivery service, while Uber uses the Face API to verify the identity of drivers in poor lighting — think cars at night.

Dana Barnes, who leads the company’s Joint & Defense Agencies business unit, said the IC is already using these tools. How so? Barnes said he’d have to get back to us on that. But he did say his new deal, announced on Tuesday and potentially worth hundreds of millions of dollars over six years, will expand the IC’s use of the tools.

Microsoft’s expanding toehold in the IC’s cloud market isn’t an immediate threat to Amazon, which supplies spy agencies with cloud services for secret and top-secret work. “This gives them another cloud for their other classifications of data,” said Barnes.

But the deal does show that the race is tightening for the the Pentagon’s Joint Enterprise Defense Infrastructure, or JEDI, contract, which will be by far the department’s largest-ever order of cloud services. Google is also in the race, as is front-runner Amazon, currently the department’s largest provider of cloud services and the only major one whose cloud is rated for Impact Level 6, necessary for hosting secret data.  

But a senior Defense Department official cautioned in April against writing Microsoft off. The company already runs eight data centers specifically for the government’s Azure users. “Only US federal, the Department of Defense (DoD), State and local governments and their partners have access to this dedicated instance of Azure operated by screened US persons,” a company press release said.

And Microsoft has said that they would be able to meet Impact Level 6 requirements within nine months of winning the JEDI contract.

Pentagon leaders have said they want their cloud-service providers to offer artificial intelligence and machine-learning tools to reduce analyst workload and help move data to and from troops on the front lines. According to Barnes, the intelligence community has a similar wishlist.

“With this particular community, we have a lot of forward-deployed organizations. That internet-of-things capability at the edge, to bring those advanced compute capabilities there, it’s very, very important,” to them, he said.

Defense officials, facing criticism for their decision to go with a single cloud provider for the JEDI contract, have emphasized to reporters that JEDI won’t be the last Defense Department cloud contract.

“Very few organizations are going to be single-cloud organizations” said Barnes. “Azure has the ability to manage multiple clouds,” through the Azure Security Center, he said, pointing out that many of the workloads that analysts and intelligence professionals work with in the Amazon cloud actually come from Microsoft products like Word, etc. “There will always be some integration to tie those together.”