US Department of Defense Gives High-Security Green Light to Amazon Web Services

The Amazon-friendly Obama Administration has found yet another way to reward the tech giant from Seattle. Earlier this week, the Financial Times reported that the Department of Defense (DoD) gave Amazon's cloud computing juggernaut a high-security clearance. That means Amazon Web Services (AWS), as the enterprise is commonly known, is in the driver's seat to obtain very lucrative, often secret business from federal agencies producing and managing the government's classified information needs.

From funding and revenue perspectives, the approval represents a bonanza for Jeff Bezos' tech empire. Barring an act of folly, Amazon is now in a position to reap federal financial rewards for a generation. The formidable barriers to entry in this field would likely daunt all but the strongest, largest, and most connected players. Amazon's desire to grow and monopolize this consistent money maker should not be underestimated. Certainly IBM and other blue-chip firms, which have had their way in this arena for decades, will find Amazon's seizure of this financial high ground a "disruptive" business development.

Jeff Bezos doesn't have to send Barack Obama a "thank you" card. In fact, 44 sent one to Amazon's monarch earlier this year, when the president visited an Amazon warehouse in Tennessee and characterized its dogshit-wage jobs as an entry point to the middle class. One wonders why the most powerful person on the planet felt -- and continues to feel -- compelled to provide Amazon with such gratitude.

Amazon, USPS Sign Sunday Delivery Deal

The Amazon-friendly Obama Administration has just concluded another Amazon-friendly deal with the secretive tech company. According to a story in today's Seattle Times, the PO and Jeff Bezos' firm will begin Sunday deliveries in time for the Christmas shopping season. The arrangement is currently limited to the New York and Los Angeles metropolitan areas, the two leading retail markets in the United States.

The deal gives Amazon a significant commercial advantage, in that it can use the USPS infrastructure and staff to deliver goods. The extra available delivery day is also another arrow in Amazon's competitive quiver.

How taxpayers benefit from this agreement was not exactly spelled out, although Amazon will pay for the privilege of going postal. It's public knowledge that the USPS is desperate for money. Amazon has the cash, and the clout with the Obama Administration, to make a deal. According to the Seattle Times story, any firm could have negotiated with the Postal Service for a Sunday gig. However, USPS officials acknowledged only Amazon pursued a deal. One wonders why.

Amazon's Chattanooga, TN facility,
cited by President Obama as an example of
"middle-class" job creation

Of course, as with all things Amazon, the contract is under seal. Inquiring minds would like to know why a federal contract not connected to national security should be a closely guarded secret.

This is Amazon's second federal contract coup this year. Earlier in 2013, the Seattle-based enterprise signed a contract to provide the CIA with cloud-based data systems and management.

Amazon v. IBM: The Redacted Lawsuit Over CIA Contract Publicly Available

When IBM recently persuaded the nonpartisan Government Accountability Office (GAO) to review the CIA's award of a $600 million cloud computing contract to Amazon, the corporate steam from Jeff Bezos' world headquarters could be felt even in insular Washington, D.C. Amazon did not take the GAO's review of the contract lying down. Amazon legal counsel filed suit against the United States government, of which the GAO is a part, protesting the contract review.

The court papers Amazon filed were released today; a story about Amazon's month-old, hush-hush legal snit appeared in today's Seattle Times.

The most delicious part of the story involved Amazon's assertion that IBM was essentially unworthy of winning any crumb from the CIA data management pie. Why? The sore losers from Seattle claimed that Big Blue should not be permitted to enjoy "the undeserved windfall opportunity to make its otherwise uncompetitive, materially deficient proposal competitive now that it has AWS' price and ratings in hand."

It is ironic that Amazon, which is notoriously secretive and leverages tremendous competitive advantages from its data mining and collection efforts, should complain about another firm's "early information" and ability to undercut its competitor. Mr. Bezos does not apparently like that feeling at all. Don't be surprised if there's some quiet outreach from Seattle to sympathetic ears in the Amazon-friendly Obama Administration.

Obama to Tout Amazon.com at Tennessee Speech

Amazon warehouse outside Chattanooga, TN.
Can you count the number of "middle-class" jobs in this photo?
(Image: timefreepress.com)

On Tuesday, July 30th, President Obama will visit Chattanooga, Tennessee, to deliver a speech about his administration's economic policies. According to WRCB-TV in Chattanooga, the address will be delivered at an Amazon warehouse. President 44 may very well cite Amazon's physical expansion and subsequent hiring as examples of America's middle class moving forward economically. It is unlikely the President will comment on the hundreds of small firms Amazon's Walmartization scheme will knock out of business.

The joint chutzpah of Obama and Jeff Bezos' Amazon juggernaut is breathtaking. Obama's Department of Justice has already gone to the mat for Amazon on the lucrative, influential e-book front: witness the recent, allegedly "consumer friendly" case against Amazon nemesis Apple and the major New York publishing players.  Meanwhile, the Obama administration has approved AWS, Amazon's data and cloud computing arm, to get hush-hush contracts with the CIA and NASA. Then again, this secrecy-obsessed administration may have found a kindred spirit with Amazon, which notoriously keeps the public at arm's length about its affairs.

One wonders why the president of the United States feels so compelled to publicly praise Amazon. What is the connection between the Obama Administration and Amazon? Why is this connection not questioned in major media outlets?

Amazon Deepens Reach into Federal Contracts

In March 2013, I wrote a blog post about Jeff Bezos' Amazon juggernaut landing a contract to handle CIA data storage and related data management needs. The Seattle-based firm muscled out IBM to win the deal. IBM squawked and had the contract assignment reviewed.

Reuters reporter Alistair Barr has followed up on the contretemps. His piece, which was picked up by the Mercury News, notes the impact of the shock waves the Amazon cloud computing triumph on Old School tech firms, including "Big Blue," as IBM is sometimes known.

The story quoted some investment analysts for attribution. They noted how AWS -- the heart of Amazon's cloud computing initiative -- allegedly strongly shapes Amazon's current stock market valuation. Reuters' Barr grasps the notion that Amazon is really a tech company, an inconvenient fact most journalists ignore. To that end, his article cites AWS' impact on Oracle, cloud computing competitor Rackspace Holding, Microsoft, and other tech heavyweights.

Barr also cites some of AWS' publicly identified clients. One of them is NASA, which, as with the CIA, happens to be involved in highly classified operations. (An ironic aspect of this situation is that Jeff Bezos recently sponsored the retrieval from the Atlantic Ocean of what he claimed were Apollo 11 rockets. A related report and images appear in a gizmodo.com post.)

Another AWS client is PBS. Inquiring minds are wondering why a federally and viewer-subsidized media outlet requires Amazon's cloud computing clout. (In late 2011, PBS and Amazon signed a deal in which PBS would show some of its programming on Amazon Prime.)

What's most interesting in the increased coziness of the Obama Administration's bureaucracy and Amazon is why it's happening at all. Just don't expect that story to appear on the News Hour anytime soon.

IBM Protests Amazon-CIA Deal

Image source redacted
(Just kidding!)

It's rarely a good idea to wake up a sleeping giant. However, it appears Amazon's deal to provide data services for the Central Intelligence Agency has provoked computer and data titan IBM into action.

Big Blue, as IBM used to be known in what now seems like ancient digital history, launched a successful protest of the Amazon-CIA deal. According to the tech reporting site the register.com, IBM got the feds' General Accounting Office (GAO) into the act. Like any worthy Captain Reynaud, the GAO found reasons to compel reconsideration of the CIA agreement. (It's worth comparing notes on this story. To that end, read federaltimes.com's version of events. The site is owned by the Gannett media chain.)

Amazon's muscling into lucrative, long-term, no-questions-asked federal contracts clearly alarmed the relatively Old School corporate suite at IBM. What Amazon might not have fully considered was IBM's friends. And their friends also have friends. As the Donald Sutherland spook character in the movie JFK noted, "They fight back -- their way."

Image: forbes.com

Theregister.com post noted that IBM's protest comes at a most inconvenient time for Jeff Bezos' tech empire. Amazon may soon be tarred in the intelligence mining scandal, as Dropbox, which uses Amazon Web Services (AWS), may be fingered as another participant in the NSA data sweep.

The choicest part of theregister.com's post is its quote from the Amazon statement on the contract issue: "Providing true cloud computing services to the intelligence community requires a transformative approach with superior technology. The CIA selected AWS based on its superior technological platform..."

Amazon, Google Sweat During Apple-DOJ Trial

Lost in the flash blast of the NSA data mining revelations was today's Apple-DOJ court case highlights. Witnesses included Google's director of strategic partnerships, whose testimony was cut to ribbons by Apple's lead attorney, according to a story in theverge.com. Today's star, however, was Amazon vice president for Kindle content Russ Grandinetti. Many observers were especially keen to hear what a typically "no comment" senior management Amazon official would say under oath. Also, there was more than a little suspicion about the Seattle company's motives, as this Obama administration darling was widely viewed as the stimulant for the antitrust complaint.

Amazon VP Russ Grandinetti
(photo: engadget.com)

Grandinetti answered all questions except one -- the key one. According to a report that appeared in macdailynews.com, the Amazon VP said he was not "'comfortable discussing the contents of a January 24, 2010 meeting held in Amazon boss' Jeff Bezos' Seattle boathouse. He quickly went from uncomfortable to silent: "Although Grandinetti wouldn't say anything about the meeting in Bezos' boathouse -- not even if Bezos attended it -- documents presented into evidence showed that the next day, Jan. 25, Amazon began developing its own terms for an agency contract. Those terms, as it turns out, were remarkably similar to the ones Apple was negotiating with the publishers...Those terms are among the ones the government has characterized in Apple's contracts as part of an illegal scheme to fix prices."

Jeff Bezos' boathouse
(photo: forbes.com)

One can imagine why Grandinetti was "not comfortable." Had he acknowledged Bezos' attendance, that assertion would have implied the Amazon capo's involvement in this critical meeting. Well, maybe Bezos is the kind of secretive billionaire who indulges his employees and lets them have Sunday meetings at his private boathouse, since Jeff wasn't using it. (Of course, we have to take Bezos' absence on faith, don't we?)  Maybe Bezos will give Russ and friends the keys to his automobiles, a way into the kitchen in case they're hungry, a change of clothes for a swim. Are you buying this story?

Whose idea was to have the meeting at the Amazon CEO's boathouse?

Report: Amazon Lands Contract to House CIA Data

Here's something to think about as you cozy up to your Kindle Reader: Amazon may soon be a CIA contractor.

As reported originally in Federal Computer Weekly and picked up by the LA Times and The Christian Science Monitor, Amazon Web Services has landed a $600 million deal to provide a cloud-computing "solution" for the intelligence service The two entities may be a perfect match, as both share a penchant for secrecy and a lust for data. The CIA at least has to undergo Congressional oversight, something Amazon often dodges artfully.

Both Amazon and the CIA also prefer storing data indefinitely. The CIA's CIO, Gus Hunt, recently told a tech-heavy gathering in New York that "connecting the dots" in intelligence gathering required the CIA to "collect everything and hang on to it forever." Amazon's M.O. is essentially the same as the spooks' approach to everyday business, except that Big A's clients and prospects offer up their data without question. The CIA just takes.

For some time, the Obama Administration has been cozy with Amazon. The Obama re-election campaign's successful use of "big data" showed the president's awareness of this tool's scope and reach. For some time, I've wondered why the Department of Justice would go out of its way to conduct investigations whose principal commercial beneficiary was unquestionably Amazon.  Of course, Amazon has the data capacity to make many things happen, even for an institution with unique needs, such as the CIA. Perhaps the calculation was that it would be best to keep Big A happy, and keep it on your side. Maybe some top-secret data business could be "accommodated" by the secretive Seattle-based firm. (Keep in mind that Amazon chief Jeff Bezos' "Blue Origin" project is building a rocket for manned space flight.)

Oh yes, for the record, neither the CIA nor Amazon would comment to the media on the reported cloud-computing contract.

Jeff Bezos Flies Solo on Phone Patent Application

Most of us are familiar with Jeff Bezos as Amazon's caudillo. It turns out Mr. B. also has a touch of the inventor in him.

A report in geekwire.com noted that Bezos applied for a patent involving smartphones and information sharing via audio signals. The current standard, known as "bumping," would presumably be the target of Bezos' proposed "innovation."

What's remarkable is that the Amazon CEO has enough time on his hands to tinker in the lab. Perhaps that explains why he rarely talks to the media, shareholders, or (heaven help us) Amazon customers.

In case you're wondering, Bezos is the sole inventor listed on the patent application. Well, at least one can't accuse the caudillo of false modesty.

Jennifer 8. Lee vs Full Disclosure

Earlier this week, digital publishing evangelist Jennifer 8. Lee had an opinion piece published in The Seattle Times. The article appeared just prior to the Frankfurt Book Fair, an event where small, medium, and big-league international publishing insiders buy, sell, or trade assets as well as gain (hopefully) useful information. Lee's piece doesn't say anything new or illuminating about the publishing biz. However, the article's appearance, and what it does not say, are curious. Let me elaborate.

Seattle is home base for Amazon, far and away the most disruptive force in publishing's often insular world. What goes uncited in Lee's piece is her enterprise's connection to Amazon, even though the Seattle-based firm is mentioned twice in the story.

Lee co-founded and runs a self-defined "literary studio" called Plympton. Its vision, according to Plympton's website, is to reinvent "how people experience literature by combining serialized fiction and digital platforms." A little over a month ago, Amazon CEO Jeff Bezos launched a line of serialized fiction books that would appear on -- drumroll, please -- Kindle gadgets. Three of the ten titles were from Plympton's stable of assets. Supposedly, according to a Boston Globe story, Plympton and Amazon inked the deal 24 hours before Bezos announced it before a very high-profile audience in Santa Monica. Some have strongly doubted the public version of this story, specifically noting that Amazon's profound lust for secrecy and control would have ruled out any initiative that hadn't been thoroughly calculated for intention and impact.

Lee's Seattle Times opinion piece doesn't mention the Amazon-Plympton dots, never mind bother to connect them. This disingenuous stance, from a former New York Times technology writer, makes me wary of the writer's intention. Just what was the point of this piece? Who was its target? (C'mon, you know in your heart it wasn't the subscribers of The Seattle Times.) According to the thumbnail bio at the end of the piece, she "splits her time between Boston, San Francisco and New York." Hmmm.....no second home in The Emerald City.

There are many unanswered questions in the publishing world. These are just a few of them.

Amazon Cold Shoulders Seattle Charities

(photo from gizmodo.co.uk)

While many have sung Amazon's praises as a prototype of the "new normal" retail business model, the Seattle-based firm is coming under fire for its uncharitable charity practices. As a recent Seattle Times article noted, Amazon is often invisible in the Pacific Northwest's non-profit and charity scenes. Not only are Amazon big shots notably absent from the Seattle charity circuit, Amazon's charitable contributions are often either negligible or completely nonexistent.

Those who have attempted to communicate or do business with Amazon knows the company is breathtakingly difficult to deal with. It some ways, Amazon's arrogance and monolithic behavior is reminiscent of life behind the former Iron Curtain. The direction for Amazon's aloofness unquestionably starts at the top with its boss, Jeff Bezos. Similar to some other tech zillionaires (notably the late Steve Jobs), Bezos believes in total control, treats shareholders with complete indifference, and simply does not talk to the media (except for his pet projects). Amazon's new Seattle headquarters buildings do not even display the company's name. Uniquely for a Fortune 500 firm, Amazon's employees are rarely involved in charitable community work and, if the Seattle Times story is accurate, are discouraged from doing so by Amazon's spooky corporate culture. (The article does note that Amazon's frosty perspective on charities is slightly thawing.)

One explanation was offered by venture capital manager and early Amazon investor Nick Hanauer. "When you have 50 or 100 percent annualized growth rates," Hanauer noted, "there's just an infinite amount of work to do to keep the thing from exploding...It requires a lot of intensity and commitment that doesn't permit a lot of other things."

How much time does it take to write and sign a check for a worthy cause?

Amazon CEO Jeff Bezos' "Blue Origin" Manned Spacecraft Project

Truth can often be stranger than fiction. Take the case of Amazon CEO Jeff Bezos and his pet project, the creation of a vertical, suborbital spacecraft and privately funded, manned space flight. To that end, over a decade ago, Bezos formed a corporate entity called Blue Origin LLC. Over the year, scientists and others (including a science fiction writer) were hired for the enterprise. Much of their work was done in a warehouse that's a manageable drive from Amazon's Seattle headquarters. During the Bush-Cheney era, Bezos also purchased land in Texas. The acreage formed the core of his version of Cape Kennedy.

It was from its Lone Star State property that Bezos and his Blue Origin team got the blues. On August 24th, a Blue Origin launch went wrong, resulting in the craft's crash in especially remote areas of West Texas. According to an MSNBC report, Bezos did not make the announcement until September 2nd, when The Wall Street Journal reported the story and forced his hand. September 2nd happened to be the Friday of the Labor Day holiday weekend, ideal for the release of bad news. (Ironically, a Russian spacecraft also crashed after launch on August 24th.)

While Bezos has enthusiastically spoken about space travel, Blue Origin is a very secretive outfit. It reminds one of James Bond-style villains: egotistical, driven to achieve world domination, ruthless. If 007 is in the house, we might need him now, before Blue Origin becomes a name the world dreads.

The image shows the Blue Origin unmanned vertical, suborbital spacecraft.