For federal government, cloud is on the horizon — report

Deltek forecasts a nearly threefold increase in government spending on cloud services by 2020.

Cloud, big data and mobility are increasingly critical elements of public IT environments, according to a Deltek report released Friday that estimates agency spending on cloud alone will jump from $2.4 billion in 2015 to $6.4 billion by 2020.

The “Federal Priorities” report analyzes data from the Office of Management and Budget, as well as Deltek’s own cloud contract award records, to project government spending on cloud and big data over the next five years. Across the board, the report predicts that billions of additional dollars will be dedicated to innovative data solutions — funding for vendor-provided core big data solutions is expected to expand at a compound annual growth rate of 14.4 percent, carrying the total from $1.6 billion in 2015 to $3.2 billion in 2020.

The bounty of data churned out by large agencies coupled with a lack of in-house expertise in the federal government will lead to more opportunities for small cloud providers, the report said.

“The exponential growth of data within federal agencies has increased the complexity of IT environments,” Alex Rossino, research analyst at Deltek and author of the report, said in a release. “This creates opportunities for contractors to support agencies working to maximize the value of data.”


The momentum behind the transition boils down to simple return on investment: Agencies shut the doors on about 1,700 data centers from 2010 to 2015, saving $2 billion in overhead. In pursuit of savings and mobility, agencies plan on closing 40 percent of all non-core data centers, a goal which will shut down 2,000 more locations around the country and replace them with cloud storage solutions.

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