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Is the Cloud Saving the Government Money?

Posted on June 27, 2019

Have you ever wondered how the federal government provides important public services—like helping secure major sporting events or providing public access to weather data?

Or how the Treasury manages supplies for printing currency, or the military transports cargo around the world?

The answer: it’s in the cloud. Today’s WatchBlog explores government cloud computing and whether these services save taxpayer money.

Using cloud services

Each year, the federal government spends approximately $90 billion on IT. To deliver better IT services for less money, the government began requiring agencies in 2010 to move to cloud services when feasible.

Cloud services provide access to shared resources (networks, servers, and data storage that multiple agencies can use) more quickly and at a lower cost than individual agencies can.

For example:

  • The Department of Homeland Security migrated its information sharing network to the cloud in 2017—ensuring a continuously available network for law enforcement and emergency response during major sporting events and natural disasters.
  • The National Oceanic and Atmospheric Administration deployed public weather websites to the cloud in 2017 to provide timely access to weather data during hurricanes and other extreme weather events.
  • Treasury migrated its system for tracking paper, ink, and other supplies for printing currency and securities to the cloud in 2012, improving its ability to determine how much currency to produce.
  • DOD’s U.S. Transportation Command began to transition all computer systems that move cargo and passengers worldwide to the cloud in 2018—helping ensure the systems are more secure and continuously available.

Saving money

We reviewed 16 agencies to determine how much they saved after moving to cloud services.

Between 2014 and April 2019, 13 of the agencies reported that they had saved $291 million in total.

However, officials from the 13 agencies stated they were only able to track some savings data on an ad hoc basis for certain cloud investments. In addition, 3 agencies (DOD, State Department, and Social Security Administration) couldn’t provide savings data for any cloud investments.

Agencies identified 3 factors that impacted their efforts to provide savings data:

  • Untracked or hard-to-track savings data. DOD reported that they did not have the management system capability to track these types of data. The State Department reported not having reliable data because they were developing a tracking capability.
  • Moving to the cloud resulted in no savings. Several agencies reported that they did not save money because cloud services either enabled them to buy previously unavailable capabilities or necessitated new requirements, both of which resulted in no savings.
  • OMB guidance doesn’t require agencies to explicitly report cloud savings. Multiple agencies reported that they had to specifically collect these data to meet our data request.

As a result, agencies couldn’t provide savings data for 84% of the cloud investments that we reviewed. It is therefore likely that agency-reported cloud savings data were underreported.

Moving forward

OMB reported that agencies don’t have to specifically identify savings related to cloud computing unless they choose to do so.

We recommended that OMB improve its guidance on reporting cloud savings and that agencies track cloud savings.

To learn more, read our full report.

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