Microsoft's USDA cloud-services agreement highlights the growing competition with Google over federal cloud contracts for e-mail and other applications.
Microsoft will soon power the United States Department of
Agriculture's cloud-based Enterprise Messaging Service (EMS), including its
e-mail, Web conferencing, instant messaging
and document collaboration features. While the USDA's cloud migration has been
underway for some months, Microsoft's touted the agreement Dec. 8 on its
Website, just as its competition with Google for federal cloud contracts
escalates to a new level.
"Migrating an enterprise of USDA's size and complexity from
multiple environments, across multiple agencies, requires not only a trusted
enterprise-ready solution, but also a partner that is able to work with us and
navigate everything from archiving to authentication to mobile phone support,"
Chris Smith, chief information officer at USDA, wrote in a Dec. 8 statement.
Under the terms of the USDA's May 2010 contract with Dell
for Microsoft Online Services, some 120,000 users across 21 e-mail systems will
migrate to the consolidated cloud platform. The project has been underway for
six months, and the shift to the new system will begin within the next four weeks.
Microsoft's announcement comes days after archrival Google
announced a contract to provide Gmail and Google Apps to the General Services
Administration. Both companies have been competing to bring their respective
cloud-based productivity and communications software to both governments and
large corporations. For Microsoft, such contracts represent the chance to
profit from its "all in" cloud strategy; for Google, the chance to expand its
revenue-generating businesses beyond search and advertising.
In November, Google sued the federal government, alleging
that the Department of the Interior unfairly restricted its bid to update its
e-mail and messaging system. Microsoft's BPOS-Federal suite eventually won that
contract, estimated at $59 million over a five-year cycle.
Microsoft reacted strongly to news that Google had locked
down the GSA contract. "There's no doubt that businesses are talking to Google,
and hearing their pitch," Tom Rizzo, senior director of Microsoft Online
Services, wrote
in a Dec. 1 posting on the Why Microsoft blog, "but despite all the talk,
Google can't avoid the fact that [oftentimes] they cannot meet the basic
requirements."
Rizzo also accused Google's enterprise offerings of
"inadequate product support, failure to provide a roadmap, poor
interoperability with other [lines] of business applications and limited
functionalities." By contrast, he argued, large public-sector organizations
"have consistently valued Microsoft's cloud offerings not only because of our
deep understanding of enterprise organizations, but also for their ease of use,
security and privacy capabilities."
Municipal governments have become a particularly fierce
battleground for the two companies. In October, New York City Mayor Michael
Bloomberg and Microsoft CEO Steve Ballmer announced a partnership that would
bring BPOS to around 30,000 city employees. That followed on the heels of
Google's agreement to provide cloud-based applications to City of Los Angeles
employees.
A recent survey by IDG Research Services suggests that such
competition will only increase, given that 75 percent of companies are either
integrating cloud-based solutions into their IT infrastructure, or plan to do
so over the next five years. In any case, Google and Microsoft are likely to
trade tit-for-tat cloud contracts for some time to come.
Editor's Note: The date of the Microsoft/USDA rollout has been changed.
Nicholas Kolakowski is a staff editor at eWEEK, covering Microsoft and other companies in the enterprise space, as well as evolving technology such as tablet PCs. His work has appeared in The Washington Post, Playboy, WebMD, AARP the Magazine, AutoWeek, Washington City Paper, Trader Monthly, and Private Air. He lives in Brooklyn, New York.
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