Local Governments Less Cautious on Cloud than Feds

Way back in 2007 I wrote a post about how small businesses often outpace their larger counterparts in adopting new technologies. I don’t think it’s because SMBs are naturally less risk averse than the big guys, or more innovative. I credit it largely to the fact SMBs don’t have to jump through as many bureaucratic hoops as large companies.

Thus I wasn’t surprised to see an InformationWeek article that says state and local governments are more eager adopters of cloud computing than federal agencies. The public sector is widely considered more bureaucratic than the private sector, and I expect the piles of red tape grow as one moves from the local to state to national level. The article quotes Gail Thomas-Flynn, Microsoft’s vice president of state and local government:

I think state and local may be moving a little more quickly, especially at the local government level. There’s an opportunity to be a little more agile at the local government.

In the past few months alone, Microsoft inked a deal to provide cloud-based unified communications and collaboration services to the state of Minnesota and a deal with New York City to provide cloud-based apps for 100,000 city employees.

The latter deal is especially interesting as it features a somewhat unusual licensing arrangement. While Microsoft has typically required the bundling of applications, the NYC agreement allows applications to be unbundled and grouped into three usage type categories: occasional users, basic users and power users (presumably with different cost structures for each). This seems to be an effort to address concerns over cloud licensing costs, which may be hampering cloud adoption.

While the federal government has been keen to promote the cloud as a way for agencies to cut costs and improve services, its efforts to do so haven’t taken off. As I wrote in June, the Apps.gov website, which was supposed to facilitate purchases of cloud services has not been popular with agencies.

The InformationWeek article also mentions Microsoft’s rivalry with Google for public-sector cloud contracts, a topic IT Business Edge’s Lora Bentley wrote about yesterday.