Microsoft Scores A Win For Office 365 With Chicago Deal

Chicago is replacing three disparate email systems with Office 365 in a move the city said would reduce per-employee costs by 80 percent for an annual savings of $400,000 during a four-year contract with Microsoft, the city said in a statement. It did not say what email systems are being removed.

City employees also will be using Office 365's document and spreadsheet applications. In addition to cost savings and improved IT security, the city said adopting Office 365 would improve employee collaboration and provide workers with desktop and mobile access to the applications.

[Related: Champion Solutions Offers Office 365 Management Tools To The Channel ]

A Chicago city spokesperson did not respond to questions about whether a solution provider is part of the project or whether other cloud application vendors -- including Google -- competed for the contract.

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Microsoft is engaged in an increasingly competitive battle with Google, Zoho and other suppliers of cloud-based personal productivity applications. Microsoft touted the win and cited similar contracts with the City of San Francisco and the states of California and Minnesota as signs of Office 365's momentum. In November Microsoft announced that the U.S. Environmental Protection Agency was adopting Office 365 for 25,000 employees under a $9.8 million contract.

But, Google has racked up its own wins with its competing Google Apps, including sales to Swiss drug maker Hoffman-La Roche for more than 80,000 employees and the U.S. Interior Department for 90,000 employees.

Adopting Office 365 is part of a larger strategy by Chicago to overhaul its IT operations and migrate IT systems to the cloud, the city's statement said.

"The cloud strategy gives city employees the ability to do their jobs more effectively while saving taxpayer dollars, decreasing duplication among departments and streamlining our operations across the board," said Brett Goldstein, Chicago's chief information officer and commissioner of the Department of Innovation and Technology (DoIT), in a statement.

"The cloud strategy is a major step towards our goal of modernizing our information technology. Ultimately, updating the City's digital infrastructure for the 21st century sets the foundation for innovation that will continue to move us forward," he said.