Study: Federal gov't can save billions in IT spending

The U.S. government could save billions of dollars by moving to more open-source software, cloud computing and virtualization, a recent study suggests.

Over three years, the potential savings would be US$3.7 billion for using open-source software; $13.3 billion for using virtualization technologies; and $6.6 billion from cloud computing or software-as-a-service, the study said. It was published by MeriTalk, an online community about IT and public policy; Red Hat, an open-source software vendor; and DLT Solutions, a value-added reseller of Red Hat and other IT products.

"After years of boosted funding, federal IT managers are facing a new challenge -- the budget crunch," the study says. "With a grave economic outlook and a new administration in office, federal agencies will be forced to do more with less."

Looking at 30 federal agencies, the study assumes every agency is starting from scratch with new technology. So instead of buying new software, agencies could save a collective $3.7 billion using open-source instead of proprietary software. Agencies could save $13.3 billion using virtualization technologies instead of buying new servers, and they could save $6.6 billion by using cloud computing instead of buying software and hardware.

The numbers are based on federal agency budgets, using assumptions from other studies about federal computing resources.

"Looking at the programs in the 30 agencies' IT infrastructure budgets, it was not possible to determine if the programs were already using the technologies," a MeriTalk spokeswoman said. "As such, we had to assume that agencies are starting from scratch. The report highlights the potential savings opportunity for each technology, with the idea that using virtualization, for example, enables agencies to reallocate that funding for higher-priority projects."

The study seems to make some large assumptions about how much money federal agencies can save, said Susie Adams, CTO of Microsoft Federal. The study "really tries to simplify a very complex problem," she said.

Microsoft agrees that agencies can save money using cloud computing and virtualization, but open-source software is "just another business model," Adams said. Agencies should explore the entire cost before making a decision about open-source software, she added.

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