Arik Hesseldahl

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IBM Brings the Cloud to New York City

Computing giant IBM has announced that it has landed a contract to consolidate the computing operations of 14 different New York City agencies to a modern cloud computing environment.

The contract, I’m told, is worth $7.7 million and covers the first part of a three-phase project called CITIServe, which will ultimately see the consolidation of 50 different municipal data center operations scattered around the city over five years. The city hopes to save $100 million on its IT budget over the five years. Helpful, yes, but it’s not likely to put much of a dent in the city’s budget deficit, which is expected to be $2.4 billion in the fiscal year beginning July 1.

It might not occur to the average New Yorker that the city has so many data centers. It certainly surprised me, though calling them data centers may be overstating it a bit. A few are groups of servers in back offices no bigger than 1,000 square feet. The plan is to get them centralized both physically and from a management perspective. Each agency has its own staff handling the management.

The first things that will be streamlined in this phase of the project are the help desk, hosting, storage, email, virtualization and network for several city departments, though neither IBM nor the city is saying yet exactly which departments are involved. A statement from the city last March said the departments of Education, Buildings, Housing Preservation and Development, Sanitation and Finance would be among the first involved. Finance itself will be a pretty big job. It collects $25 billion in taxes and other revenue, and assesses about a million individual properties collectively worth more than $1 trillion. Then there’s the matter of the 10 million parking tickets the city issues each year.

The agency in the spotlight is the Department of Information Technology and Telecommunications, which will be in charge of managing the migration and then will run the new data centers once they’re operational. The plan is the result of a top-down 30-day study of the city’s IT infrastructure that Mayor Mike Bloomberg ordered last year.

Getting these services centralized will make them easier to protect and reduce the power needed to run them, thus reducing the city government’s carbon footprint, says David Cohn, program manager of the Smarter Cloud program at IBM Research. It’s not uncommon for servers that are set up to run just one application to use only 10 percent of their computing capacity, and then sit idle the rest of the time, burning electricity throughout that idle time.

“Getting a smaller number of systems running more applications and using less power is just the beginning,” Cohn told me. “After that you start developing deeper insight into where all your information is going that you couldn’t get before.”

It’s a positive sign for IBM on the cloud computing front. You may remember that Ric Telford, IBM’s VP of cloud services, said government is a segment it considers a priority this year. If New York successfully adopts the cloud, more will probably follow.

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