Breaking through the Debt Ceiling with Cloud Computing

With little more than a week remaining before the federal government risks defaulting on its debts, Congressional leaders and top aides are working to craft a proposal that would allow a divided Congress to increase the federal debt ceiling and avert a potentially crippling economic crisis.

At this point, everything is on the table.

This evaluation includes taking a hard look at all federal expenses including IT spend. The federal government spends about $80 billion a year making it the largest buyer of information technology in the world and has been exploring budget-tightening initiatives for the last several months.

According to a recent New York Times article, the federal government is on pace to shut down 40% of its data centers over the next four years. Vivek Kundra, chief information officer for the federal government, explained that the data center consolidation was part of a broader strategy to embrace more efficient, Internet-era computing. In particular, the government is shifting to cloud computing which can be provided by the government to its agencies or by outside technology companies.

Tapping cloud computing services, Mr. Kundra said, could save the government an additional $5 billion a year, reducing the need for individual government agencies to buy their own software and hardware.

Earlier in the year, the Commission on the Leadership Opportunity in U.S. Deployment of the Cloud (CLOUD²) was formed to serve a three-month mandate to provide the Obama Administration with recommendations for how government should deploy cloud technologies and for public policies that will help drive U.S. innovation in the cloud. 

The commission will make recommendations for how government should deploy cloud technologies and address policies that might hinder U.S. leadership of the cloud in the commercial space. In fact, our very own Nick Mehta was named as one of the 71 commissioners that will help present the commission’s recommendations to Mr. Kundra (while commercial-facing recommendations will be shared with Commerce Secretary Gary Locke and Commerce Under Secretary Pat Gallagher).

The government’s move to the cloud is really part of a much larger rethinking about information technology. While a clear motivation is the cost savings, the larger goal is to make the government more nimble and more responsive in delivering core services.

And given the overall growth of cloud computing, this lesson is not being lost on the private sector either.  As companies, large and small, are just trying to keep their heads above water, it just makes sense to rethink your own IT strategy and determine if the cloud can play a larger role.