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Federal government setting reduction targets on data center usage

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By Marjorie Censer
Monday, October 11, 2010

The federal government is moving to dramatically reduce the number of data centers it relies on, in a move that promises to reshape the local information technology landscape.

Vivek Kundra, the federal chief information officer, said the Office of Management and Budget has completed its inventory of the government's data centers and is now setting reduction targets as part of the 2012 budget process.

In an Oct. 1 memo to federal CIOs, Kundra reported that the government has just shy of 2,100 data centers -- a number that covers owned and leased centers larger than 500 square feet. The Defense Department boasts the highest number with 772, while the State Department comes in second with 361. On their heels are the Interior Department with 210 and the Department of Health and Human Services with 185.

The lowest number of any agency was one -- for the Office of Personnel Management.

Agencies have also submitted consolidation plans that set reduction targets, Kundra said, and OMB will review them to ensure agencies have been aggressive enough. As an example, he said the Department of Homeland Security has committed to shrinking from 24 data centers to two within the next five years, while the Treasury Department will go from 42 to 29. The mandate does not apply to data centers involving national security or classified material, Kundra said.

He said the move is meant to reduce the government's spending on energy, real estate and operations. It is likely to also push agencies into adopting cloud -- or Web-based -- computing platforms. Because cloud computing relies on a shared pool of resources such as networks, servers and storage, it uses data centers more efficiently.

"In the coming decade, the data center consolidation initiative will play a fundamental role in our shifts to cloud computing platforms," Kundra said.

While some data center operators may be holding their breath, other companies are hoping to play a major role in helping agencies consolidate their operations and move to cloud computing.

Unisys, which bases its U.S. operations in Pennsylvania but has an extensive local presence, has prioritized data center consolidation work as a key focus area, said Venkatapathi "PV" Puvvada, vice president and managing partner for civilian agencies. After all, the company reduced its own data centers from 53 to two in the 1990s.

At Agilex Technologies in Chantilly, Chief Technology Officer Tim Hoechst said the shift can't happen soon enough. Helping agencies consolidate information technology resources and move to the cloud already represents close to a quarter of the company's business, Hoechst said.

We fully expect this is going to be a flagship business for us," he said.

Yogesh Khanna, chief technology officer of Falls Church-based CSC's North American public sector, said traditional information technology work is likely to wane over time. But change is inevitable.

"If you don't reduce the cost of operations, you sort of miss the boat ... It does cannibalize a little bit of what has been feeding the contractors," he said. "Having said that, cloud computing fundamentally is what I call the new growth platform."


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