Understanding the increasing need to segue the federal government from traditional, physical data centers to a cloud computing model, the Obama Administration requested $35 million to facilitate a cloud computing transition.
However, in light of increasing pressure on the government to cut spending and reduce the federal budget, the Senate Appropriations Committee recently voted to decrease the budget for the cloud computing transition by $15 million, from $35 million to $20 million.
With the federal budget inflated from economic stimulus programs, extensions to unemployment benefits and other initiatives designed to help get the country through one of the worst economic downturns in recent history, it’s understandable that these Senators would want to cut costs wherever possible. Unfortunately, cutting the amount of money needed for a cloud computing initiative is counterproductive for what they’re looking to accomplish.
The benefits of cloud computing in the federal government are multiple and powerful. In addition to increasing collaboration by making important data more accessible and easier to share, the potential for cost savings is huge.
By reducing the amount of federal data centers, the government will eliminate costly and perpetually recurring costs, such as:
- The high electric bills incurred by running power-hungry IT hardware and cooling infrastructure
- Property costs (rent, etc.) for the space necessary to house data centers
- Hardware costs for new equipment
The exponentially increasing amount of data that federal government agencies are being forced to store also means that physical storage solutions will continue to be stressed and new storage capacity will continue to be added. This is just another expense that these agencies will need to incur that could be eliminated with cloud computing and storage.
Cloud computing will also free up IT staff to do higher order tasks. By eliminating the burden of doing commodity operations, cloud computing gives IT staff members a better opportunity to tackle tasks that better align with core mission values.
Much like the creation of America’s space program, the transition to cloud computing will take a significant initial investment. After all, you couldn’t build a spaceship without first building a transistor and microchip. But also like the space program, the transition will yield significant innovation and cost reductions in the long run.
When you look at the federal government’s overall IT budget of approximately $75 billion, the $35 million originally requested for the cloud computing transition is approximately .05%. However, that small percentage has the potential to be the single largest IT cost reduction, if managed correctly.
How many technology vendors of scale are going to be motivated to focus, invest and innovate with such a small cloud computing budget? By promising to redirect the $75 billion in spend to more utilitarian solutions, like cloud computing, the government could better focus the private sector on the innovating new cost-cutting technologies.
CIO’s and agency heads should be motivated to redirect their agency’s IT spend to the cloud. Most CIO’s we speak with tell us that approximately 80% of their budgets are directed towards “just keeping the lights on,” with high-yield innovation and new cost saving expenditures accounting for an abysmally small portion of their IT spend. Cloud and virtualization technology has the capacity to disrupt the legacy model.
Instead of cutting the cloud computing budget and other IT budgets, the federal government needs to begin to look at their IT acquisitions differently. Instead of acquiring technologies based on how much they cost, they should instead be looking for technologies that will eliminate costs in the long run. The value of these IT acquisitions will, over time, be significantly greater and function to save the government large amounts of taxpayer dollars.
If the Senate Appropriations Committee wants to positively impact the country’s current economic situation, they need to do something more creative than simply cutting budgets. The committee needs to promote the kind of technologies that save taxpayer dollars over time, and cloud computing is just such a technology.