IBM Wins Massive $1 Billion Government Contract

Last updated :

ibm contractToday is a great day for IBM. The company has just won its biggest U.S. cloud-based government contract. The new IBM contract is valued at $1 billion. In other words, the pressure for IBM’s cloud team is on.

IBM recently lost a $600 million contract to Amazon that was awarded by the CIA, though that contract has been contested and IBM may win it back eventually. Clearly, the U.S. government is swiftly moving ahead when it comes to the cloud, and the government’s trust is with IBM.

What Will Happen

With the government moving ahead and choosing IBM’s cloud-based services, hundreds of data centers in the U.S. will be shut down. Some of those centers may be consolidated too. The move will save the government a lot of money, and it will also place some tech companies at the front of the pack.

In addition to the IBM contract, the government has also awarded nine other companies with similar contracts. Having this kind of government backing means that other competing cloud companies are now left behind (something that Louisiana-based CenturyLink sued the government for back in May).

The Other Nine

In addition to IBM, the other companies that made the government award list include CGI Group Inc. (GIB) of Montreal; Verizon Communications Inc. (VZ), based in New York; Unisys Corp. (UIS), based in Blue Bell, Pennsylvania; and AT&T Inc. (T), based in Dallas, and Lockheed Martin based in California (LMT); Aquilent Inc., based in Laurel, Maryland; Smartronix Inc., based in Hollywood, Maryland; Autonomic Resources LLC, based in Cary, North Carolina; and Global Technology Resources Inc., based in Denver.

Needless to say, these companies are going to be rising to the top of the cloud scene. CenturyLink did not make the government’s list. These companies were all chosen for their cloud technology skills in a wide range of categories including security, software, general technology, and other initiatives.

Additional Details

The government is being somewhat quiet about the move to the cloud, but it will spell a big savings. It will also point to some lost jobs as data centers consolidate and close throughout the U.S. As mentioned, IBM is hoping to take away the current deal that Amazon has made with the government, though that case is still being contested.

What does IBM have that other cloud companies don’t? For one, it’s a major US-based company that has proven itself with the government time and again (this isn’t the first government contract IBM has been awarded, though it is the first cloud-based contract). For another, IBM seems to have the security and technology that the government is looking for in any cloud company that must be able to handle sensitive government documents.

Does the government’s move to the cloud make you nervous? Will the cloud be a safe place for government files? What do you think of IBM’s award? Let me know in the details below, or send in a message with a question for me. I’ll get back to you the next day, guaranteed!