IBM Lands $30 Million Cloud Contract With The U.S. General Services Administration


Although IBM has lost the ongoing legal battle with Amazon for the $600 million government cloud contract with the CIA, the Armonk, N.Y.-based company has been awarded a five-year, $30 million cloud deal with the U.S. General Services Administration (GSA).

Announced on Monday, IBM will leverage its cloud infrastructure and services for a new order management system for the government agency. GSA will utilize IBM's SmartCloud for Government and its analytics to improve service and better predict customer needs, said Luanne Pavco, managing partner of IBM Public Sector Services.

"This is the first cloud opportunity and approach on order management; it will help provide a better system to do [the GSA's] 5.5 million and more orders," said Pavco. "This new system, based on our cloud technology and wrapped by our end-to-end services, will allow them to do things more effectively and be more flexible in delivering to their customers more visibility, transparency and agility to do what they need to do."

With the transformation to cloud, GSA will save time and money in providing packaged consumer goods, office supplies, hardware and other products to its U.S. government, military and civilian customers, said Pavco.

[Related: Exclusive: Amazon Claims Victory Over IBM in $600M CIA Contract Court Case]

According to Pavco, IBM has invested billions in its cloud data center infrastructure and with a 70 percent year-to-year growth around cloud computing, the company has exceeded a $1 billion in cloud revenue for the 2013 third quarter.

"Cloud is a priority for us," said Pavco. "This [contract] allows us to have a stronger footprint of our SmartCloud for Government within the federal sector and helps us demonstrate to our government clients the strength of IBM."

In addition to the contract, IBM unveiled Tuesday its newly built Federal Cloud Innovation Center, located in Washington, D.C. The Federal Cloud Innovation Center will help and collaborate with federal agencies and other public sector organizations to progress cloud computing adoption.

Despite the recent government shutdown and decrease in federal IT spending, there is still plenty of opportunity for service providers to optimize infrastructure in the federal market and advance the transformation to cloud, said Pavco.

"The market environment itself is requiring service providers, like IBM, and federal agencies, like GSA, to rethink how they do their standard processes to deliver their mission," said Pavco. "Cloud and analytics are two key tools in being more effective and efficient in providing their mission to their end users."

PUBLISHED OCT. 24, 2013

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