Regional Cloud Hubs – How Government Clouds May Function In The Future

Regional Cloud Hubs – How Government Clouds May Function in the Future

Sometime back I had written about the possible issues affecting the government move to the cloud (See: Does Moving to the Cloud work for the US Federal Government?). Now, a report indicates that “regional cloud hubs” can ameliorate several of these issues, not only for the federal but also the state governments.

First, some background information. According to the report “Best Practices: Regional Community Cloud Hubs – The New ‘Trickle Down’ Effect That’s Boosting State and Local Computing,” published by global market intelligence firm International Data Corporation’s (IDC: http://www.idc.com/) Government Insights group, a new type of government cloud services labeled “regional cloud hubs” will significantly change the way state and local governments procure online computing services. These hubs are defined as one government agency offering computing services to other government agencies and are already working successfully in Utah and Michigan.

Now, these regional cloud hubs will ensure that cloud implementation is kept “within the family” of officialdom, thereby allowing for greater confidence on security – one of the issues mentioned in the aforementioned article. Additionally, volume purchases from source agencies can give customer agencies a substantial pricing edge, much more than is possible in the private sector. This would translate to substantial cost savings, another issue mentioned in the aforementioned article. Finally, moving to a shared service environment also helps local governments conform to broader data standards, thereby helping with one of the major drawbacks in cloud computing today (See: Cloud Computing Standards: How Important Are They?).

We believe that cloud hubs will see rapid growth, since the first multiagency efforts have already shown a positive return on investment and solid service levels for cloud solutions subscribers. In general, the larger government operations that already manage complex IT systems will evolve as the most likely regional hosts. Smaller government agencies may choose to get out of most IT hosting and management operations, as long as they can find reliable, affordable and privately hosted solutions through the cloud,” said Shawn McCarthy, research analyst at IDC Government Insights.

According to the report, this evolution has the potential to trigger the following game-changing consequences:

  • For the host facility, it can turn a government agency cost center into a revenue center. By selling cloud solutions to other government organizations, host agencies can offset their own IT costs.
  • Local governments can buy cheaper cloud solutions than they might find on their own and they may be able to reduce capital expenditures and overhead costs.
  • Cloud services will replace internal client/server systems as the main model for government application delivery. The race is on to build shared regional datacenters and the largest portfolios of government solutions.

Considering that consolidation is very much on the government’s mind (See: Federal CIO Vivek Kundra Plans to Shut Down 100 Data Centers by 2012, 800 by 2015), the development of regional cloud hubs is a distinct possibility. After all, even the private sector is showing such a trend.

By Sourya Biswas

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