08-25-11 | Blog Post

Breakdown of Federal Cloud Computing

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The problem with the old IT infrastructure, according to Federal CIO Vivek Kundra in Federal Cloud Computing Strategy:

“…low asset utilization, a fragmented demand for resources, duplicative systems, environments which are difficult to manage, and long procurement lead times.”

With a focus on improved operational efficiency and government service delivery, Kundra intends to allocate $20 billion of the U.S. government’s total $80 billion IT budget for cloud computing migration. His Cloud First policy requires government agencies to move at least three current projects to the cloud by mid-2012, and encourages the use of cloud services for any new projects. The intent behind the cloud computing strategy is to consolidate and reduce nearly 2,100 data centers by 40 percent by 2015 – resulting in an estimated $5 billion annual savings and a major reduction in energy expenditure (NYTimes.com).

In his Federal Cloud Computing Strategy document, he outlines the numerous benefits of moving to the cloud, including efficiency and agility – in their current IT environment, it would take years to build data centers for new services and months to increase the capacity of existing services. But with the cloud, they would experience almost immediate scalability with increases and reductions in capacity. This type of elasticity allows them to use only as much as they need, which is another issue when it comes to server use, which is typically less than 30 percent. Cloud computing increases server usage to 60-70 percent.

The government agencies have been responding – Homeland Security has worked private cloud computing into their 2011 budget in order to support their email system. The General Services Administration has also moved its email services to the cloud and expects to save $15 million over a period of five years.

GSA & Cloud Computing Investment & Savings
General Service Administration’s Cloud Computing Investment & Savings

GSA Initial Investment: $6.9 million
GSA Total Savings: $15.2 million over period of 5 years

The benefits not only include cost-savings, but streamlined productivity with the ability to scale projects without any major infrastructure changes, as Chris Smith, the Agricultural Department’s information chief reported to the New York Times. The Department of Agriculture switched to the cloud late last year to support their email system.

Kundra cites an interesting example of how traditional IT infrastructures can deplete budgets and malfunction due to underestimated system demands. The “Cash-for-Clunkers” or  Car Allowance and Rebate System anticipated 250,000 transactions but instead received 690,000 transactions. The program suffered from outages and service disruptions within just the first three days of dealer registrations and the budget had to be tripled.

Cloud computing introduces a solution by allowing agencies to quickly scale up to meet demand. Read more about the CARS case and the government’s plan in the Federal Cloud Computing Strategy document.

Federal Government Departments Finally Making Moves to Cloud
The Pros and Cons of the Federal Push Toward the Cloud
US Government Adopts ‘Cloud-First’ Policy
Feds Plan More Competition for IT Business
White House Names a New Chief of Information Technology
U.S. to Close 800 Computer Data Centers

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