New York City Goes To the Cloud with Microsoft

New York City has made an agreement with Microsoft to shift certain operations to the Cloud. With a very large customer enterprise  involving 100,000 city employees,  Steve Ballmer and Mayor Bloomberg  announced a new five-year deal which will roll up dozens of separate city contracts with Microsoft into one master agreement and should save the city $50 million. The expected value of the deal is close to $100 million, or $20 million a year.

New York expects to see savings not only from the consolidation of different contracts, but also by shifting some of the city’s software needs to the cloud. The first phase of the deal will  impact 30,000 city employees, and it will include various programs and software. We’re talking about Microsoft Windows 7, Sharepoint, Office, Exchange, Azure, Live Meetings,  Windows Server, development tools, and database products. They also expect to add Office 365 when it becomes available.

One aspect of the agreement is to identify what groups will be included and how they will impact the contract and the Cloud. City workers will fall into one of three groups:  infrequent, basic, and power users. Because the city has many employees that are  deskless workers that it, those who are out on the streets, so giving them access to the Office suite , email, and collaboration tools in the Cloud is more practical than  giving them desktop versions of Office. Power users, on the other hand, will require both desktop and cloud versions.  The upshot for New York city is that the more software that Microsoft hosts on its own servers, the more practical will the IT operations be and the city will save on hardware and IT costs.

The rollout should begin near the end of 2010 and in the first quarter of 2011. Still undetermined from this contract is how the hardware upgrades will come about, or if any are needed.