This morning, the state of Minnesota announced that it would use Microsoft’s private cloud computing technology as a platform for its collaboration software. Microsoft’s blog post reasonably Minnesota’s move to the cloud as an “historic first.” Given that the state’s press release, embedded below, describes it the same way, that’s not unfair. Details have yet to emerge on the security or privacy requirements that the Redmond-based software giants signed to gain the customer but, as the release notes, “the move makes Minnesota the first U.S. state to move to a large collaboration and communication suite in a private cloud environment.”
While federal, state and local government entities have used Amazon, Google Apps or Salesforce.com, today’s news at least adds Microsoft’s offerings into the conversation. The implementation will likely deploy the Windows Azure platform to deliver Microsoft’s Business Productivity Online Suite (BPOS).
“As states battle growing deficits, they are continually being asked to do more with less,” said Gopal Khanna, Minnesota’s State Chief Information Officer in a prepared statement. “Rethinking the way we manage our digital infrastructure centrally, to save locally across all units of government, is a crucial part of the solution. The private sector has utilized technological advancements like cloud computing to realize operational efficiencies for some time now. Government must follow suit.”
Not all reactions are quite as optimistic, however, particularly with respect to reduced costs. “I forsee short term gain,” tweeted researcher Simon Wardley, “large future exit costs, increased consumption, no long term reduction in IT expenditure.”
Why no long term reductions in state IT expenditures by going to Microsoft’s private cloud?
“See Jevons’ paradox,” Wardley replied. “Causes are co-evolution, long tail of demand, componentisation and increased innovation. In other words, you’ll just end up doing more. Countries & States are in competition with each other … not just firms. It’s not MSFT specific, it’s general to all clouds. The ‘cloud will save you money’argument forgets consumption effects. You might as well argue that Moore’s law should have reduced IT expenditure. [Cloud will] reduce your costs if your workload stays the same but alas it won’t, it’ll increase for the reasons previously listed.”