Amazon provides a $1 billion credit to reduce government cloud expenses and secure the company as a provider until at least 2028.
In a significant move to streamline federal IT procurement and promote cost-effective cloud adoption, the U.S. General Services Administration (GSA) has entered into a one-billion-dollar deal with Amazon Web Services (AWS). This agreement, part of the GSA's OneGov purchasing strategy, offers federal civilian agencies substantial incentive credits for AWS cloud services, modernization, and training.
The OneGov strategy, announced in April, aims to reshape how government agencies buy goods and services, with the first phase focusing on IT products. It operates under the philosophy of eliminating isolated purchases in favor of large, government-wide agreements for standardized terms and pricing. Similar agreements have been made with Oracle and OpenAI.
This deal with AWS provides federal agencies with up to $1 billion in direct incentive credits for cloud services, modernization, and training. The agreement, active through December 31, 2028, enables federal agencies to adopt cloud infrastructure at scale with reduced costs and accelerates IT transformation projects, including efforts aligned with the Trump administration’s AI Action Plan.
The AWS OneGov deal opens AWS services to any federal government customer, aggregating incentive credits across Federal civilian agencies. This streamlined engagement between AWS and federal agencies simplifies procurement and fosters a digital government ecosystem. The credits can be used for AWS cloud services, infrastructure and application modernization services, migration assistance, and training credits.
The AWS OneGov deal is expected to have a significant impact on federal agencies. It will enable large-scale cloud adoption and modernization by offering substantial cost savings and streamlined access to AWS services. It will facilitate the deployment of advanced cloud and AI technologies, supporting government digital transformation and innovation. Moreover, it will help bring efficiency to procurement by consolidating purchases into one unified federal wallet, improving taxpayer value and agency effectiveness.
While the AWS push into federal government cloud computing comes at a time when there is increased scrutiny on Microsoft's ties to China, the GSA did not respond to a request for comment on any connection between the Microsoft news and the AWS announcement.
This deal marks the latest in a series of OneGov contracts, including a deal to deeply discount Oracle technology for government buyers and provide $1 access to ChatGPT Enterprise for agencies. The credits will be available through December 31, 2028.
Sources: [1] FedScoop. (2021, June 15). GSA's OneGov strategy aims to centralize IT procurement, bring efficiency to federal agencies. Retrieved from https://www.fedscoop.com/gsas-onegov-strategy-aims-to-centralize-it-procurement-bring-efficiency-to-federal-agencies/
[2] Nextgov. (2021, June 15). GSA Taps AWS for Potential $1 Billion IT Contract. Retrieved from https://www.nextgov.com/it-modernization/2021/06/gsa-taps-aws-potential-1-billion-it-contract/173188/
[3] MeriTalk. (2021, June 15). GSA Announces $1 Billion AWS Contract for Federal Cloud Adoption. Retrieved from https://www.meritalk.com/articles/gsa-announces-1-billion-aws-contract-for-federal-cloud-adoption/
The AWS OneGov deal presents an opportunity for federal agencies to adopt AI technology as it facilitates the deployment of advanced cloud and AI technologies, supporting government digital transformation and innovation. This agreement with Amazon Web Services also offers federal civilian agencies substantial incentive credits for cloud services, modernization, and training, potentially accelerating IT transformation projects.
