Report: Feds Ready to Spend

Data center vendors can look forward to a steady stream of federal IT spending continuing on its upward trajectory, regardless of who wins the upcoming elections. These are the findings of the latest research from analyst firm Input.

The months surrounding an election are often a nervous time for vendors, who worry about the effect of a new government on the federal cash cow. Some enterprise customers even slow their IT spending down at election time (see CyberGuard Survives Q1 Hurricanes).

But, regardless of who is installed in the White House on January 20, the federal governments budget for IT spending looks to be overflowing for the next few years. Input says that Washington will spend $23 billion on technology procurement in fiscal year 2009, 35 percent more than in 2004.

Data center suppliers will be rubbing their hands -- large-scale systems, such as supercomputers, will account for $8 billion of the 2009 figure, with servers weighing in with an additional $7.5 billion, says Input.

Chris Campbell, senior analyst at Input, thinks it unlikely that a new government would reverse this trend. “The IT agenda will not change that much," he says. "There was very little change in the underlying IT goals of the Clinton and Bush administrations."This means that the U.S. government will continue its migration away from centralized, mainframe-oriented architectures toward client/server environments. There will also be a continued emphasis on sharing information among different government agencies, according to Campbell.

So, what can vendors do if they want a slice of the federal pie? Campbell believes that, with the current emphasis on data sharing, hardware manufacturers must offer systems that can be easily deployed in different departments. “Vendors need to identify solutions that multiple agencies can use to bring cost benefits,” he asserts. “Obviously, you can’t have the exact same solution for the Department of Justice and the Department of Agriculture, but there will be some technology overlap.”

Campbell believes that partnerships are the other key to success. “A lot of the outsourcing contracts are going to all-encompassing service providers like Electronic Data Systems, so it’s very important for service providers, resellers, and manufacturers to team up."

But one of the most lucrative parts of government is likely to remain the Department of Homeland Security (DHS), according to Campbell, as the big-spending department continues to launch new initiatives (see Homeland Security Spending Spree).

— James Rogers, Site Editor, Next-Gen Data Center Forum0