GSA cloud savings said to be significant despite overstatement

Moving USA.gov to cloud saved a bundle

Although a General Services Administration official recently overstated cloud computing savings by a factor of 500 in one application, the actual savings achieved in the application were higher than average, experts said today.

GSA is saving $1.7 million a year by moving support and hosting for USA.gov to the cloud, not $850 million as originally claimed on March 23 by Katie Lewin, GSA cloud computing program manager. A GSA spokeswoman later provided the correct figure and said Lewin may have misspoken.

The GSA previously paid $2.35 million in annual costs for USA.gov, including $2 million for hardware refreshes and software re-licensing and $350,000 in personnel costs, Caren Auchman, press secretary for GSA, wrote in an e-mail message.


Related story: 

Oops: GSA official overstates cloud computing savings


After moving USA.gov to the cloud, the annual cost dropped to $650,000, which is the amount paid to contractor Terremark Enterprise Cloud services, she said.

The annual savings are estimated at $1.7 million, she said. That is a 72 percent savings from the former cost.

A 72 percent savings is a higher-than-average savings rate achieved for moving a government data application into a cloud computing environment, Darrell West, director of governance studies at the Brookings Institution, said today.

Generally, government agencies have been saving about 25 percent to 50 percent on applications moved to the cloud, said West, who is sponsoring a seminar on cloud computing savings for government on April 7.

The savings cover a broad range because it depends on the size of the applications involved and if high security is involved, among other factors, West said.

“There are definitely savings to be achieved,” West said. However, if there must be background checks for personnel, data storage in the United States, and a secure storage facility, that limits savings, he added.

Another factor is whether an agency is willing to cut personnel that may not be needed following the shift to cloud computing, he said. “If you are outsourcing, they could enable cost savings, but many agencies are unwilling to get rid of personnel,” West said.

Frank Zamani, chief executive of Caspio, Inc., claimed savings of 50 percent to 80 percent can be achieved for government agencies.

“These savings are not only due to the efficiencies inherent in cloud computing, but also Caspio's platform that effectively eliminates the need for programming,” he said.

Mark Pietrasanta, chief technology officer for Aquilent, said government data centers can save 50 percent to 75 percent on power consumption by shifting to cloud computing.

About the Author

Alice Lipowicz is a staff writer covering government 2.0, homeland security and other IT policies for Federal Computer Week.

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