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New York City, Microsoft Announce Cloud Computing Agreement

The agreement is expected to save the city $50 million over five years.

New York City Mayor Michael Bloomberg and Microsoft CEO Steve Ballmer announced Wednesday morning a large-scale IT agreement will deliver Microsoft cloud computing services to 30,000 city employees while also consolidating the city’s licensing agreements into a single, unified system.

The agreement will replace the city’s prior licensing arrangements, which were conducted individually by city agencies, and according to Bloomberg, were “complicated, cumbersome, and needless to say, not very cost effective.” The mayor said the agreement will yield significant savings for the city going forward.

“Central to this partnership is a new licensing agreement — the first of its kind — we think in the nation, which will produce more than $50 million in savings for the city in the next five years,” Bloomberg said in a news conference.

The agreement will allow the city to leverage its buying power to consolidate agreements into one single, multi-year licensing contract that will be made available to more than 100,000 city employees.

The agreement’s other component involves 30,000 New York City employees moving to Microsoft cloud services for e-mail, instant messaging and other services. Application development and software updates will also take place in the cloud, which the city and Microsoft say will lead to increased employee productivity.

“I’m sure you all know cloud computing is becoming an increasingly popular method for people to collaborate and access information. Instead of working off a hard drive or server, all your programs and documents are delivered securely through the Internet — hence, in the cloud. It means city employees will be able to more easily share their work with co-workers, whether they’re sitting in the next room, across town or even on the other side of the world,” Bloomberg said.

New York City and Microsoft are “really partnering to figure out the next generation [of] ways to really use this kind of cloud-based infrastructure to deliver next-generation city services with an agility, a speed and an effectiveness of city workers that hopefully has never been seen before,” added Microsoft’s Ballmer.   


Miriam Jones is a former chief copy editor of Government Technology, Governing, Public CIO and Emergency Management magazines.