By David Shepardson
(Reuters) -Amazon Web Services has agreed to provide U.S. government agencies with up to $1 billion in savings for cloud adoption, modernization and training through the end of 2028, the U.S. General Services Administration said on Thursday.
The agency said the agreement with the unit of Amazon.com “will accelerate large-scale IT transformation across government and spur AI innovation.”
A government report in March said the federal government annually spends more than $100 billion to manage IT systems, acquire new systems, or update old ones.
Amazon has won billions of dollars in contracts to help federal agencies transition to the cloud and for other services. The U.S. government has struggled for years to modernize its aging IT systems.
The agreement offers up to a total of $1 billion in direct incentive credits in total across Federal civilian agencies including savings on core AWS cloud services, modernization and training credits.
“This landmark agreement marks a significant milestone in the large-scale digital transformation of government services,” said AWS CEO Matt Garman.
Federal agencies will have access to AWS training resources and experts to help them move to the cloud. AWS supports more than 11,000 government agencies worldwide.
The deal between GSA and AWS aims “to reduce the cost of federal IT expenditures, save taxpayer dollars, drive innovation and agility in new government services, and secure America’s continued leadership in AI,” the government said.
In 2022, the Pentagon awarded $9 billion worth of cloud computing contracts to AWS, Microsoft Corp, Alphabet Inc’s Google and Oracle Corp.
The Joint Warfighting Cloud Capability was the multi-cloud successor to the Joint Enterprise Defense Infrastructure (JEDI), an IT modernization project to build a large, common commercial cloud for the Defense Department.
Amazon during Trump’s first term sued after the $10 billion JEDI contract was awarded to Microsoft. Amazon said Trump exerted improper pressure on military officials to steer the contract away from the company.
(Reporting by David Shepardson; Editing by Andrew Cawthorne and Nick Zieminski)
