US court rules for Amazon.com in CIA cloud contract dispute

Reuters

Oct 7 (Reuters) - A U.S. court ruled in favor of Amazon.comInc, which is locked in a dispute with InternationalBusiness Machines over a $600 million cloud computingcontract awarded by the Central Intelligence Agency, a courtnotice showed.

Amazon Web Services (AWS), a unit of online retailerAmazon.com, beat out IBM earlier this year to win the CIAcontract.

When AWS won, IBM protested, triggering a report by the U.S.Government Accountability Office (GAO), which recommended inJune that the CIA re-do some parts of its contract negotiations,giving IBM another chance to bid.

But the GAO also stated that AWS's offering was superior.

Amazon filed a legal complaint against GAO's recommendationthat the CIA could give IBM another chance to bid for thecontract.

On Monday, oral arguments were held before Judge ThomasWheeler of the U.S. Court of Federal Claims.

At the end of the arguments, Wheeler ruled for Amazon andagainst IBM, which had intervened in the case. A written opinionwill follow, according to a court notice.

The Wall Street Journal reported that IBM would appeal theruling by the Federal Claims court. IBM and Amazon could notimmediately be reached for comment by Reuters outside of regularU.S. business hours.

Public cloud computing, which AWS pioneered in 2006, letscompanies rent computing power, storage and other services fromdata centers shared with other customers - typically cheaper andmore flexible than maintaining their own.

The case is in re Amazon Web Services Inc vs United States,Case No. 13-00506, U.S. Court of Federal Claims.

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