Amazon.com Inc. is a company that is accustomed to winning, but the $869 billion e-commerce giant has spent the last few weeks suffering through humbling defeats. On Oct. 25, the Pentagon announced it was awarding a $10 billion cloud computing contract to Microsoft Corp. Amazon had been seen as such a prohibitive favorite for the contract, called JEDI, that the Department of Defense was actually facing a lawsuit for setting up a process that only the company could win. Then Amazon’s preferred candidates failed to capture control of the Seattle City Council in local elections less than two weeks later, even after the company had spent $1.5 million on the campaign.
The setbacks are not directly connected, but they follow a familiar pattern. Amazon gets into an interaction with government officials with supreme confidence—critics invariably call it arrogance—only to snatch defeat from the jaws of victory. The results don’t reflect a lack of resources. Amazon spent $4 million on federal lobbying last quarter, the most it has ever spent in a single three-month span; last year it lobbied more government entities than any other tech company.
Amazon Chief Executive Officer Jeff Bezos hasn’t always made things easy for his policy team. President Donald Trump regularly singles out Bezos and Amazon for ridicule, a grudge that people within the company attribute to the president’s hostility to the Washington Post, which Bezos bought in 2013. Last summer Trump told Bloomberg News that Amazon may be in a “very antitrust situation.” Around the same time he directed James Mattis, then Secretary of Defense, to “screw Amazon” out of the JEDI contract, according to a book by Mattis’s former speechwriter. The company is planning to file a lawsuit challenging the decision, accusing the government of “unmistakable bias.” (The Pentagon has said its procurement process is insulated from politics.)
The victories that Amazon does claim—better terms for tech on trade deals, job-creating deals to build fulfillment centers—draw less attention than its setbacks.....READ MORE
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