Federal government spending on cloud computing rose by about eight percent in Fiscal Year 2020, to $6.6 billion – from $6.1 billion in FY2019 – although the growth rate in cloud computing spend by the Feds slowed from prior periods.

A Bloomberg Government report found that Federal contracts for cloud infrastructure, platforms, and software will reach the $6.6 billion mark for FY2020 once all Defense Department (DoD) contracts are reported, but also noted the impact of two multibillion-dollar DoD cloud deals that are stuck in limbo due to protest. Most notably, the Joint Enterprise Defense Infrastructure (JEDI) contract remains tied up in litigation, and sorting out that deal would have a big impact on total Federal cloud spend considering the contract’s $10 billion ceiling.

Per the report, DoD has been moving ahead with cloud services even without JEDI through programs like  Cloud One, cArmy, and the Joint Common Foundation. Earlier this week, DoD suggested that it might move on from the JEDI contract, should the legal battle continue to drag on.

Accounting for 48 percent of total cloud spending are contracts for platform as a service (PaaS) and Infrastructure as a service (IaaS) platforms, the report said. Software as a service (SaaS) accounts for 23 percent of cloud spending, while cloud support services amount to 27 percent of cloud spending.

The report also found that the big spenders among agencies for cloud computing are the Centers for Medicare and Medicaid Services, the Department of Veterans Affairs, and the U.S. Air Force.

By FY2023, the report projects, Federal cloud spending will reach $8.5 billion, on an expected growth rate of nine to 10 percent annually. DoD is expected to make up $2.7 billion of that spending in FY2023 – as increase of $2.1 billion from its expected cloud spending for FY2020.

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Jordan Smith
Jordan Smith
Jordan Smith is a MeriTalk Staff Reporter covering the intersection of government and technology.
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