Microsoft has emerged victorious in a dramatic competition for public cloud resources for the U.S. Defense Department, beating out market leader Amazon Web Services, the Pentagon said on Friday. The contract could be worth as much as $10 billion over a decade, according to a statement.
The achievement highlights the emergence of Microsoft’s Azure cloud as a challenger to AWS and represents the latest victory for Satya Nadella, who took over from Steve Ballmer as Microsoft chief in 2014. Microsoft has also won major cloud-infrastructure deals from companies like Walmart even as AWS has kept growing.
If the deal ends up being worth $10 billion, it would likely be a bigger deal to Microsoft than it would have been to Amazon. Microsoft does not disclose Azure revenue in dollar figures but it’s widely believed to have a smaller share of the market than Amazon, which received $9 billion in revenue from AWS in the third quarter.
Early in the process Amazon was seen as the favorite, partly because its AWS business won a deal with the CIA in 2013.