Follows discount agreement made with Oracle
The US government has struck a discount agreement with Google for its cloud services.
As first reported by the Financial Times and citing a senior official at the General Services Administration (GSA), the discount agreement is expected to fall in the same ballpark as the recently announced discounts offered by Oracle.
Revealed earlier this month, Oracle has offered government agencies a 75 percent discount on its software, databases, and analytics, as well as a "substantial" discount on cloud computing services through the end of November.
According to the FT report, a deal with Google is expected to be finalized in the coming weeks, with similar agreements with Microsoft Azure and Amazon Web Services (AWS) expected to follow.
“Every single of those companies is totally bought in, they understand the mission,” the senior official said. “We will get there with all four players.”
Google previously gave the US government a 71 percent discount on some Workspace contracts for the period between April and September. The cloud provider declined to comment on what the pending cloud deal might look like.
According to the FT, the US government's cloud spend currently exceeds $20bn annually, with the four cloud providers mentioned making up the bulk of that spend.
President Donald Trump's administration has been looking to cut costs since taking office, including those of IT procurement, under the Department of Government Efficiency.
Microsoft declined to comment to the FT, while Amazon and Oracle did not respond to requests for comment. A spokesperson for GSA similarly declined to comment on the ongoing negotiations.
President Trump has previously had a complicated relationship with cloud providers. During his first term, after courting Amazon Web Services for a $10bn "Joint Enterprise Defense Infrastructure" (JEDI) contract, Trump u-turned and awarded the contract to Microsoft.
Throughout the procurement process, several cloud providers complained, arguing that its requirements unfairly ruled them out. Amazon, after losing the contract, argued that "political interference" had led to the shift to Microsoft.
JEDI was later scrapped by the Biden administration and replaced with the Joint Warfighting Cloud Capability contract, which was awarded to all four cloud providers and valued at $9bn.
