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Study: Open Source, Virtualization, SaaS Could Save U.S. Government $23.6 Billion


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Study: Open Source, Virtualization, SaaS Could Save U.S. Government $23.6 Billion

Michael Dinan | February 23, 2009 - TMCnet Editor


After days and weeks of micro-analysis of the United States’ newly passed $787 billion economic stimulus plan – including about $7.2 billion for nationwide broadband – a new study says that the federal government could save billions by moving to more open source software, virtualization and cloud computing.

The 14-slide study – from MeriTalk, online group that studies public policy and IT, as well as Red Hat and DLT Solutions Inc. – says that after years of boosted funding, federal IT managers are facing a new challenge: the budget crunch.
“With a grave economic outlook and a new administration in office, Federal agencies will be forced to do more with less,” the study says. “Across 30 key Federal agencies, the government allocated $60 billion for IT infrastructure in FY07, FY08, and FY09. Instead of worrying over a budget stop, why not make the most of the money we are already investing?”
According to the study, open source software, virtualization and cloud computing will help do just that.
Specifically, MeriTalk’s study envisions $3.7 billion in savings with open source: $467 million from the U.S. Air Force, $251M in savings from the U.S. Department of the Treasury, and $174 million in savings from the U.S. Department of Veterans Affairs.
Virtualization could bring $13.3 billion in savings, including $1 billion from the U.S. Army, $880 million from the U.S. Department of Justice and $592 million from the U.S. Department of Agriculture.
The study also says that cloud computing, or software-as-a-service, could bring $6.6 billion, which includes $551 million from the U.S. Department of Homeland Security, $387 million in savings from the U.S. Department of Energy and $279 million in savings from the U.S. Department of Health and Human Services.
Here’s how MeriTalk’s study envisions spending the money that could be saved:
Certainly, the study touches on a timely subject: government spending.
As TMCnet has reported, the telecommunications world has hotly debated the benefits and drawbacks of a new initiative to use $7.2 billion deploy broadband nationwide– for the taxpayers who are subsidizing it, the services’ recipients, the economy at large and escalating unemployment rates.
Last week, an industry veteran of more than 20 years told TMCnet in an interview that the portion of the $787 billion in the economic stimulus package that’s dedicated to nationwide broadband deployment likely will lead to wider use of VoIP.
Backed by broadband networks, hospitals and businesses, especially, will view VoIP as easier to install and manage than traditional PBX (News - Alert) networks, and will be cheaper overall for general use, according to Craig Settles, president and founder of Oakland-based
“Broadband networks that incorporate WiMAX (News - Alert) or other wireless access will likely result in a lot of VoIP usage,” Settles told TMCnet in the interview. “If you have fiber providing 20, 30 or more megabits per second of backhaul for the wireless component, using VoIP makes all the sense in the world.”
Although – as Grant Gross of IDG News Service reports here – MeriTalk’s new report has been criticized as overly simple, it appears that federal agencies should be looking at new ways to save money with IT investments, Peter Tseronis, deputy associate chief information officer for the U.S. Department of Energy, reportedly said.
The study highlights the need for federal agencies to look at new ways of doing business and to think strategically about long-term IT investments, Tseronis told Gross.
“The infrastructure itself needs to be sound – it needs to be stable,” Tseronis reportedly said. “If you don’t have a solid base, it’s not going to matter what’s on your desktop.”

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Michael Dinan is a contributing editor for TMCnet, covering news in the IP communications, call center and customer relationship management industries. To read more of Michael's articles, please visit his columnist page.

Edited by Michael Dinan

By Michael Dinan

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