By Justin Scheck in New York, Bradley Hope in London and Summer Said in Dubai
Through much of 2018, Amazon.com Inc. founder Jeff Bezos and
tech-savvy Saudi Crown Prince Mohammed bin Salman seemed to be
hitting it off.
Texting over WhatsApp about a plan for Amazon to build a huge
data center in Saudi Arabia, the men forged a cordial and mutually
beneficial relationship. "It is very important for me, my friend,
that you come to Saudi during the future investment Forum and we
announce this $2.8B Vision 2030 partnership," the prince messaged
Mr. Bezos on Sept. 9, 2018, according to a review of texts by The
Wall Street Journal and people familiar with the situation.
Amazon stood to gain broader access to the Middle Eastern
market. Prince Mohammed could be aided in his efforts to reform the
Saudi economy as well as burnish his personal brand.
Now, one of the world's richest men and one of the most powerful
princes are archenemies, each accusing the other of betrayal.
Over the course of 2018, Prince Mohammed grew frustrated as the
Bezos-owned Washington Post published critical columns by Saudi
dissident Jamal Khashoggi, according to people familiar with the
matter. Mr. Bezos was deeply disturbed after men working for the
prince murdered Mr. Khashoggi that October, said people familiar
with the situation.
But the feud didn't erupt into a public spectacle until last
week, with the surfacing of a report commissioned by Mr. Bezos that
said -- with "medium-to-high confidence" -- that Prince Mohammed
had installed spyware on Mr. Bezos' phone via a WhatsApp message in
May 2018.
The Saudi government denies that the prince hacked Mr. Bezos'
phone. The Journal has reported that Saudi officials close to the
crown prince said they were aware of a plan to compromise Mr.
Bezos' phone, though not that an attack actually happened.
William Isaacson, a lawyer for Mr. Bezos, declined to comment
for this article, as did representatives for the Saudi government
in Riyadh and Washington. An Amazon spokesman declined to comment
on details of the data-center plan.
Later in 2018, the National Enquirer received embarrassing texts
and photos of the then-married Mr. Bezos and his girlfriend, Lauren
Sanchez, and published some of them in January 2019. Mr. Bezos has
said there was Saudi involvement in the matter, an assertion the
Enquirer and the Saudi government disputed.
The Journal has reported that the Enquirer paid $200,000 to buy
the racy texts and photos from Ms. Sanchez's brother Michael
Sanchez, according to people familiar with the matter, and that
federal prosecutors have evidence indicating Ms. Sanchez had given
him the material.
Ms. Sanchez hasn't responded to requests for comment. Mr.
Sanchez said in an emailed statement: "With spoon-fed lies and
half-truths, Wall Street Journal keeps getting it wrong."
It is a remarkable show of public animosity between two men who
seemed to have aligned interests when they met in 2016.
Prince Mohammed had taken over efforts to remake the Saudi
economy, a position he gained after his father, Salman, became king
in 2015. The prince told friends and acquaintances that he sees
himself in the mold of tech-company founders like Steve Jobs and
Mr. Bezos -- men who built business empires through visionary
leadership and supreme self confidence.
For several years, Prince Mohammed has met with investors, money
managers and chief executives to explain his vision. Among his big
initiatives was a $500 billion tech-focused city called NEOM that
he planned to build along the Red Sea.
In confidential planning documents the Journal reviewed,
consultants for the Saudi government outlined "tailor-made
incentives" to woo Amazon as a major part of the project, including
government funding and 99 years of free rent.
Many Western business leaders wanted the prince to invest Saudi
money in their operations, people familiar with the meetings said.
Amazon was one of the few willing to invest a large amount of money
in Saudi Arabia. The data center would serve Amazon customers
across the region, according to people in the Gulf and the U.S.
familiar with the talks.
The two men had an April 2018 dinner in Los Angeles during a
U.S. tour the prince made. For Prince Mohammed, it would be among
the first major investments in the kingdom by a Western tech
company, and one of the first times a big foreign company would
chose Saudi Arabia, rather than traditionally business-friendly
locations like Dubai or Abu Dhabi, as a Mideast hub.
The details were negotiated by lower-level teams. But the prince
and Mr. Bezos kept in touch about the project on a high level over
WhatsApp, people familiar with the project said.
WhatsApp was a key tool of the young prince's global charm
campaign. In his first few years as crown prince, he handed out his
WhatsApp contact information to visiting dignitaries, businessmen,
academics and some journalists so often that his phone streamed
messages day and night, people who interacted with the prince
said.
Prince Mohammed would go through the messages every day, those
people said. Receiving a response was a surprise for Americans
accustomed to doing business in the Gulf, where senior princes were
typically aloof.
Talks about a data-center project that could cost $2 billion or
more were under way when Prince Mohammed and Mr. Bezos began
communicating over WhatsApp in spring 2018, the people familiar
with the matter said. Saudi officials believed Amazon was willing
to commit up to $4 billion to the project, said people involved in
the talks.
Yet the prince at points griped to Mr. Bezos about Amazon's
earlier business decisions in the region -- it had bought an
e-commerce company in 2017 that competed with a business co-owned
by the Saudi sovereign-wealth fund, and announced a deal to build a
data center in neighboring Bahrain.
"I was very disappointed" to hear about the Bahrain deal, the
prince texted Mr. Bezos, according to the people familiar with the
exchanges. He wrote that Amazon's decision not to partner with
Saudi Arabia from the get-go "has pushed" Saudi Arabia to compete
in e-commerce with Amazon.
Still, the prince continued to send enthusiastic messages
through the summer of 2018 about Amazon's eventual arrival in the
kingdom, these people said.
It turns out the prince's messages to Mr. Bezos were somewhat
misleading.
Prince Mohammed's security adviser, Musaid al Aiban, had already
frozen the data-center deal because Amazon.com wouldn't allow Saudi
intelligence and law enforcement access to the data as part of the
discussions, people familiar with the matter said.
On April 17, 2018, less than two weeks after the prince and the
CEO had dinner in Los Angeles, Mr. Aiban told officials working on
the deal not to complete it -- and also not to tell Amazon it was
being held up. Prince Mohammed was apprised of this strategy,
according to these officials.
"Never say no publicly. We just keep stalling and cite
bureaucratic delays," said an adviser for the government who worked
on the project.
Multiple efforts to reach Mr. Aiban through media
representatives of the Saudi government were unsuccessful.
It was important not to alienate Mr. Bezos because Prince
Mohammed wanted him to attend the Riyadh financial conference later
in the year. Nicknamed "Davos in the Desert," it was the prince's
opportunity to trumpet, domestically and abroad, his alliances with
the world's business and technology leaders.
Through the summer of 2018, the prince encouraged Mr. Bezos to
come to the October conference, text messages show. It isn't clear
whether Mr. Bezos ever formally committed to attending.
Then, on Oct. 2, 2018, Mr. Khashoggi, the Washington Post
columnist, entered the Saudi embassy in Istanbul and never emerged.
The Post wrote a number of investigative articles and editorials
about the murder, many blaming Prince Mohammed.
For days, Saudi Arabia issued statements denying involvement
only to be contradicted by information gathered by Turkey,
partially through recordings inside the Saudi embassy, that
indicated Mr. Khashoggi was killed by Saudi operatives.
Later that month, Saudi Arabia said officials of its government
killed Mr. Khashoggi in a rogue operation, and tried to dampen
international outrage by announcing its own investigation. The
Central Intelligence Agency concluded that the killing was carried
out under the prince's orders, U.S. officials said. Saudi Arabia
has denied the prince had any prior knowledge.
In the aftermath of the Khashoggi killing, government officials
and executives from around the world pulled out of the Riyadh
conference, including Mr. Bezos.
Around that time, National Enquirer employees got a tip about
Mr. Bezos' affair and began tailing him, the Journal has reported.
In January 2019, Mr. Bezos revealed he was getting divorced,
knowing that the Enquirer was ready to publish an article about his
affair. The Enquirer subsequently threatened to publish more racy
texts and photos unless Mr. Bezos publicly said he had no evidence
the tabloid had targeted him for political reasons.
Mr. Bezos refused the Enquirer's demand.
It wasn't until last Wednesday that details of the alleged Saudi
hack of Mr. Bezos' iPhone became public, after United Nations
officials called for an investigation of the incident and
summarized the report by Mr. Bezos' consultants.
The consultant's report has spurred questions among
cybersecurity experts, who said it relied heavily on circumstantial
evidence to make the case that a WhatsApp account associated with
Prince Mohammed was probably used to hack into Mr. Bezos'
phone.
The consultants weren't able to figure out if information from
Mr. Bezos's phone was linked to the photos and texts that ended up
with the Enquirer.
Write to Justin Scheck at justin.scheck@wsj.com, Bradley Hope at
bradley.hope@wsj.com and Summer Said at summer.said@wsj.com
(END) Dow Jones Newswires
January 26, 2020 20:29 ET (01:29 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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