Federal Cloud and Big Data Spending Poised to Nearly Double between 2016 and 2021, According to Deltek

HERNDON, Va., Nov. 29, 2016 /PRNewswire-USNewswire/ -- According to Deltek's new GovWin IQ report Federal Priorities: Cloud, Big Data, Mobility, and Data Centers, 2016-2021, cloud computing and big data represent areas of future growth within federal agencies' budgets. Federal cloud computing investments are poised to grow from $3.1 billion in FY 2016 to $6.4 billion in FY 2021. During the same timeframe, agency spending on big data products and services will increase from $2.0 billion to $3.6 billion. Accelerating the FedRAMP cloud authorization process and the hiring of Chief Data Officers and contractor consultants to guide big data strategies will help spur increased cloud and big data adoption.

Deltek's report also examines priorities in federal mobility and data center optimization, which are also evolving. Agencies spent $1.4 billion on mobile devices and services in FY 2015, a number that the Office of Management and Budget (OMB) aims to reduce through its Mobile Category Management policy directing contract consolidation and asset inventory. Agencies are also under fire to close thousands of data centers and refocus investments on optimization via cloud computing, shared services and automation.

One of the most critical catalysts for these priority areas will be the pace of IT infrastructure modernization, and a key development is the recently proposed Modernizing Government Technology (MGT) Act. If passed, this Act would allow agencies to use their existing working capital funds and tap into a new established centralized fund to replace aging infrastructure, transition to the cloud and address cybersecurity vulnerabilities.

While significant spending on key IT initiatives is expected, there are competing pressures that could temper faster advancements in cloud, big data, mobility and data center optimization. Uncertainty around the administration transition, looming sequestration, implementation complexity and risk, and contracting issues remain obstacles that agencies continue to navigate.

KEY FINDINGS

• Private Clouds Dominate – Both civilian and defense agencies continue to favor private clouds, with $1 billion in contract spending over the past three years. Cloud engineering services remain in high demand across the entire market to facilitate private cloud implementation.
• Big Data Strategies Required – Agency hiring of Chief Data Officers has slowed, potentially hindering the establishment of enterprise strategies.  While strategies are under development, agencies continue to invest significantly in analysis support services and analytics software.  
• Mobility Security – Security remains the primary barrier for broader mobility adoption. Agencies continue to work on identity and access management, data-level security, and other security requirements to reduce the barriers to innovation.
• DCOI Opportunities – The new Data Center Optimization Initiative (DCOI) launched by OMB in August 2016 is expected to give new life to lagging data center efforts. Contractors should look for opportunities to help agencies meet targets for facility utilization, virtualization, PUE, server utilization, infrastructure automation, and energy metering.

DELTEK ANALYST QUOTES

"The push for agencies to modernize their IT environments will ramp up pressure on agencies to adopt cloud computing. But with increasing concerns about security, the importance of FedRAMP compliance is only going to increase as the pace of cloud adoption increases."

– Alex Rossino, Senior Principal Research Analyst, Deltek
@govwinfiaalex

"The implementation of digital strategies that make agency data machine-readable and the hiring of chief data officers are signs that the transition to enterprise-level use of big data may be just around the corner."

– Alex Rossino, Senior Principal Research Analyst, Deltek
@govwinfiaalex

"Over the last few years, data center consolidation efforts have lost momentum to other IT priorities such as cybersecurity and mobility.  The Data Center Optimization Initiative will help renew focus and drive investments."

– Angie Petty, Senior Principal Research Analyst, Deltek
@APettyGovWin

"Security – this fear of 'shadow IT' – is the number one obstacle for broader mobility adoption. Aside from mobile devices and services, contractors should be looking for opportunities to provide solutions for both device and data level protection."

-Deniece Peterson, Director of Research, Deltek
@govwinPeterson

TWEETS

Both civilian agencies & DoD cont to favor private cloud deployments, spending $1B over 3 years, says #Deltek http://ow.ly/6pln306wx3D

#Deltek predicts fed cloud spending to grow from $3.1B in FY16 to $6.4B by FY21 http://ow.ly/6pln306wx3D

Cybersecurity, scientific research & national security cont to drive growth of #BigData solutions to $3.5B by FY21 http://ow.ly/6pln306wx3D

#Deltek predicts growth in #BigData products & services from $2B in FY16 to $3.6B in FY21 http://ow.ly/6pln306wx3D

Fed agencies closed 4% & 41% of tiered & non-tiered data centers, respectively. Goal: 25% & 60% by FY18 http://ow.ly/6pln306wx3D #Deltek

#Deltek analysis of mobile device spending shows Blackberry cont. to decline from $64.7M in FY13 to $33.9M in FY15 http://ow.ly/6pln306wx3D

For more information on Deltek GovWin IQ and this report, visit the "Federal Priorities: Cloud, Big Data, Mobility, and Data Centers, 2016-2021" page on Deltek.com/GovWin. The report is free to subscribers of GovWin's Federal Market Analysis program. 

About Deltek
Deltek is the leading global provider of enterprise software and information solutions for government contractors, professional services firms and other project-based businesses. For decades, we have delivered actionable insight that empowers our customers to unlock their business potential. 22,000 organizations and millions of users in over 80 countries around the world rely on Deltek to research and identify opportunities, win new business, recruit and develop talent, optimize resources, streamline operations and deliver more profitable projects. Deltek – Know more. Do more.® www.deltek.com

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