"And Azure is a fundamentally better and easier to use product any way."
Which explains why Azure will likely take an extra 6+ months to get their facilities up to the required minimum level. Azure is playing catchup with AWS in GovCloud. Google Azure Govcloud facilities if you don't believe me - Azure is still building out their West Coast infrastructure to support this bid.
What you call "schmoozing" is probably referred to as "working with a partner who can deliver the capabilities you require" in most industries - DoD's security model left a lot to be desired 10 years ago. Google and AWS did a lot to address that between 2009-2013, mainly due to challenges put forward by the incumbents before Azure had any real public IaaS cloud to speak of. Azure only really joined the GovCloud party ~4 years ago and are still catching up with their main competitor.