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Microsoft, Amazon in Race For $10bn Pentagon Project

The DoD is likely to announce the winner this month

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The Amazon warehouse in San Fernando de Henares is seen during a 3-day walkout to demand better wages and working conditions, on the outskirts of Madrid, Spain. VOA

The Pentagon has selected Microsoft and Amazon Web Services (AWS, the cloud computing arm of Amazon, as two finalists for its $10 billion Joint Enterprise Defense Infrastructure (JEDI) cloud contract, as Oracle missed the bus.

The JEDI Cloud computing contract at the US Department of Defence (DoD) is aimed to bring the entire military under the envelope of a single Cloud provider.

The project saw backlash from several quarters including employees at tech giants like Google and Microsoft, alleging that the “contract is massive in scope and shrouded in secrecy, which makes it nearly impossible to know what we as workers would be building”.

Succumbing to pressure from employees, Google last year dropped its bid to be part of the JEDI contract.

“After evaluating all of the proposals received, the Department of Defence has made a competitive range determination for the Joint Enterprise Defense Infrastructure Cloud request for proposals, in accordance with all applicable laws and regulations.

Microsoft
Logo of Microsoft outside it’s office. Pixabay

“The two companies within the competitive range will participate further in the procurement process,” Elissa Smith, DoD spokesperson for Public Affairs Operations told TechCrunch on Thursday.

The DoD is likely to announce the winner this month.

Last year, Microsoft employees raised ethical questions on facilitating incorporation of Artificial Intelligence (AI) on weapons, illegal surveillance and technologies that could cause “overall harm”.

Also Read- Facebook Planning To Merge All Its Platforms Into One

“We need clear ethical guidelines and meaningful accountability governing how we determine which uses of our technology are acceptable, and which are off the table.

“Microsoft has already acknowledged the dangers of the tech it builds, there is no law preventing the company from exercising its own internal scrutiny and standing by its own ethical compass,” a letter by Microsoft employees detailed. (IANS)

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Amazon Plans to Close its Domestic Marketplace in China by Mid-July

Amazon shoppers in China will no longer be able to buy goods from third-party merchants in the country, but they still will be able to order from the United States, Britain, Denmark and Japan via the firm’s global store

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FILE - Amazon plans to close its domestic marketplace in China to focus on more lucrative businesses there. VOA

Amazon.com Inc. plans to close its domestic marketplace in China by mid-July, people familiar with the matter told Reuters, focusing efforts on more lucrative businesses selling overseas goods and cloud services in the world’s most populous nation.

Amazon shoppers in China will no longer be able to buy goods from third-party merchants in the country, but they still will be able to order from the United States, Britain, Denmark and Japan via the firm’s global store. Amazon expects to close fulfillment centers and wind down support for domestic-selling merchants in China in the next 90 days, one of the people said.

Home-grown e-commerce

The move underscores how entrenched, home-grown e-commerce rivals have made it difficult for Amazon’s marketplace to gain a foothold. Consumer insights firm iResearch Global said Alibaba Group Holding Ltd’s Tmall marketplace and JD.com Inc. controlled 81.9 percent of the Chinese market last year.

“They’re pulling out because it’s not profitable and not growing,” said analyst Michael Pachter at Wedbush Securities. Ker Zheng, marketing specialist at Shenzhen-based e-commerce consultancy Azoya, said Amazon had no major competitive advantage in China over its domestic rivals.

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FILE – A logo of JD.com is seen on a helmet of a delivery man in Beijing, June 16, 2014. VOA

Unless someone is searching for a very specific imported good that can’t be found elsewhere, “there’s no reason for a consumer to pick Amazon because they’re not going to be able to ship things as fast as Tmall or JD,” he said.

Amazon’s customers in China will still be able to purchase the firm’s Kindle e-readers and online content, said the sources, who spoke on condition of anonymity. Amazon Web Services, the company’s cloud computing unit that sells data storage and computing power to enterprises, will remain as well.

The U.S.-listed shares of Alibaba and JD.com rose 1% Wednesday after Reuters first reported the move, before paring gains later in the day. Amazon’s shares closed flat.

US retreat, e-commerce showdown

The withdrawal of the world’s largest online retailer — founded by the world’s richest person — comes amid a broader e-commerce slowdown in China. Alibaba in January reported its lowest quarterly earnings growth since 2016, while JD.com is responding to the changing business environment with staff cuts.

 

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FILE – A worker removes an advertisement billboard of Indian online marketplace Flipkart, installed along the roadside in Mumbai, India, Oct. 16, 2015. Amazon.com Inc. is concentrating on India and its competition, Flipkart. VOA

It also follows the Chinese e-commerce retreat of other big-name Western retailers. Wal-Mart Stores Inc. sold its Chinese online shopping platform to JD.com in 2016 in return for a stake in JD.com to focus on its bricks-and-mortar stores.

Similarly, the country appears to factor less in the global aspirations of fellow U.S. tech majors Netflix Inc., Facebook Inc. and Alphabet Inc.’s Google, Pachter said.

ALSO READ: Microsoft, Amazon in Race For $10bn Pentagon Project

Amazon bought Chinese online shopping website Joyo.com in 2004 for $75 million, rebranding the business in 2011 as Amazon China. But in a sign of Tmall’s dominance, Amazon nevertheless opened an online store on the Alibaba site in 2015.

The firm is still expanding aggressively in other countries, notably India, where it is contending with local rival Flipkart. (VOA)