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Microsoft Unveils Public Sector Cloud Deals

Business Productivity Online Suite and Windows Azure are among the hosted services that will be delivered to regional and local government customers.

Elizabeth Montalbano

February 23, 2011

4 Min Read

Top 20 Government Cloud Service Providers

Top 20 Government Cloud Service Providers

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Slideshow: Top 20 Government Cloud Service Providers

Microsoft Wednesday unveiled 14 new cloud deals with local and regional governments and agencies as part of a push by the vendor to ramp up its delivery of cloud services to the public sector.

Seven U.S. municipalities -- including Chicago; Carlsbad, Calif.; Andover, Minn.; and Alexandria and Virginia Beach in Virginia -- are among new customers for Microsoft's cloud-based services, which include the Business Productivity Online Suite (BPOS) and Windows Azure. BPOS is a collection of hosted email and collaboration services -- including online versions of the company's Exchange and SharePoint server products -- while Azure is Microsoft's cloud-computing infrastructure.

Microsoft unveiled the new deals at its U.S. Public Sector CIO Summit, which it hosted this week in Redmond, Wash. The vendor is battling Google in offering cloud-computing services to the public sector, and is promoting its experience with enterprise customers and the ability to offer a combination of both on-premise and hosted software as a competitive edge.

"Google is coming at it from a completely online, more consumer orientation," said Gail Thomas-Flynn, Microsoft's vice president of state and local government, in an interview Wednesday. "With Google it's cloud only. … But what if you're in the cloud and you want to come back on premise? With Microsoft, you have that option."

Among the new deals are several for Microsoft's BPOS suite or individual hosted applications from the suite, which some customers are using to transition from on-premise software that's currently deployed or competitive hosted offerings.

Others aim to use it for the other benefits the cloud provides, according to Microsoft. Those benefits include cost savings and flexibility because employees can access the services from multiple locations rather than from a static desktop in an office.

Winston-Salem, N.C., for instance, plans to deploy BPOS for 2,750 employees in the spring, migrating from 600 seats of Google Apps for the Enterprise and 2,150 seats of Novell GroupWise. Thomas-Flynn said the draw for officials in Winston-Salem in migrating from Google to Microsoft for their cloud services was the latter's enterprise experience. "Primarily they cited superior manageability, security and functionality that is enterprise capable," she said.

Another new BPOS customer unveiled Wednesday is the City of Alexandria, Va., which chose to move to the cloud for collaboration and e-mail for cost savings and flexibility, according to Microsoft.

Other customers -- including the City of Andover, Minn., King County, Wash., and Sound Transit, Washington, -- are using components of BPOS.

Andover is using Microsoft Exchange Online for hosted e-mail, while King County hopes to lower maintenance and support costs and improve collaboration capabilities by using hosted versions of Office Live Meeting, Microsoft Office Communicator and Microsoft SharePoint, according to Microsoft. Sound Transit, Washington's state-owned transit system, is using Microsoft Hosted Exchange for cloud-based e-mail and archiving for more than 1,100 employees.

One customer is leveraging the ability to deploy a hybrid environment of both on-premise software and applications in the cloud that Microsoft provides, Thomas-Flynn said.

The State of Colorado is using Windows Azure Connect, a Microsoft technology in an early release, to use an on-premise SQL Server database as a service to enable a new, Web-based unemployment benefits portal for state residents, she said. The site allows people to check the status of their claims and other information about their benefits online.

Other new public-sector Microsoft cloud customers unveiled Wednesday include Vernon Hills, Ill.; the State of Idaho's Department of Labor; Reedy Creek Improvement District in Buena Vista, Fla.; the Michigan State Senate; and the Poarch Band of Creek Indians tribal government.

In addition to working with regional and local governments, Microsoft also is courting the federal government. The vendor's global services organization recently passed a key federal security certification -- the Federal Information Security Management Act of 2002 (FISMA) Authorization to Operate (ATO) -- for its cloud infrastructure, paving the way for broader adoption of its cloud-based services among federal agencies.

While Microsoft already is working with government agencies such as NASA to deploy its cloud services, it recently ran into a snafu with a potentially large cloud deployment with the Department of Interior.

A court injunction won by rival Google and reseller Onix Networks blocked a $59 million contract with Interior to move 88,000 agency employees to BPOS. The companies filed suit in late October claiming that Interior failed to follow federal procurement guidelines during its pursuit of a hosted email and collaboration suite last year.

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