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Google Wins Injunction Against Microsoft Government Contract

Court order could impact how future cloud competition plays out in federal contracts.

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Google has won a temporary order preventing the Department of Interior from awarding an estimated $59 million contract to Microsoft and deploying cloud-based e-mail and collaboration services from Microsoft to the agency's 88,000 employees.

The preliminary injunction, which could have an impact on how future competition for cloud services in government plays out, arises from a lawsuit Google and reseller Onix Networks filed in late October claiming that Interior failed to follow federal procurement guidelines during its pursuit of a hosted e-mail and collaboration suite last year. The suit called Interior's behavior an "arbitrary and capricious abuse" that violated the Competition in Contracting Act.

The Department of Interior was planning to award the contract on Jan. 25, according to the court order by U.S. Court of Federal Claims Judge Susan Braden, who said that doing so would "achieve 'organizational lock-in' for Microsoft, and cost Google the opportunity to compete." She remanded the procurement back to Interior "for additional investigation or exploration."

Court documents portray the Department of Interior as determining as early as last spring that it would move forward with Microsoft e-mail without issuing a request for quotations from other vendors, while at the same time assuring Google that the competition for Interior's business would be full and open. Interior then issued a request for quotations only to resellers of Microsoft's Business Productivity Online Suite (BPOS). For example, the documents show Google struggling to vie for the Department of Interior's attention even while Microsoft CEO Steve Ballmer met personally with Interior officials last February.

The Department of Interior declined to comment on the case, and referred all comment to the Department of Justice, which did not immediately respond to a request for comment. The Interior Department's next steps would be to appeal the ruling or modify its contracting process and take a closer look at Google. According to Google, Interior had already begun a Microsoft pilot program with 5,000 Bureau of Indian Affairs employees.

Google, as can be expected, expressed pleasure with the preliminary injunction. "As a proponent of open competition on the Internet and in the technology sector in general, we're pleased with the court's decision," a Google spokesperson said.

For its part, Microsoft claims no foul play was involved in the Department of Interior's decision, as it says that the outcome of the case will demonstrate. "The Department of the Interior determined that the dedicated, U.S.-based cloud solution offered by Microsoft met its minimum security and other requirements after a careful and thorough evaluation, and that Google’s solution did not," the company said in a statement.

While Google’s e-mail and collaboration package and Microsoft’s cloud infrastructure have been given a stamp of approval as meeting federal government cybersecurity requirements, there are some important differences between the two in terms of architecture. Probably highest on that list is that while Microsoft offers multitenant public cloud as well as private cloud and dedicated tenant products for customers who want their e-mail to be physically isolated from that of other customers, Google's offerings are multitenant only. On numerous occasions, federal agencies have indicated a preference of other options to multitenant.


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