Interior Department Rains On Microsoft Cloud By Choosing Google, Onix Networks
May 3, 2012

Interior Department Rains On Microsoft Cloud By Choosing Google, Onix Networks

Peter Suciu for

A two-year battle between Microsoft and Google over which company could supply its cloud-based server technology to a government agency has come to an end. The result is gray skies for Microsoft as the Department of the Interior becomes one of Google´s biggest cloud customers in the government sector, in a deal worth nearly $35million.

This week the Interior Department awarded Google reseller Onix Networks, via a notice posted on the Federal contracting site This ends a legal battle that began in 2010 after a similar contract had been awarded to a Microsoft reseller for an estimated $59 million.

This procurement was eventually withdrawn after a lengthy — and likely costly — court battle over whether the Department of the Interior had wrongfully specified that only services provided by Microsoft could meet its needs. Google launched a lawsuit against the department, alleging that tender requirements for the cloud email and collaboration services systems in essence unfairly favored Microsoft.

An August 2010 procurement document had indicated that Microsoft was the only company that would be able to meet the demands required by the Interior Department. Google and Onix Networks responded by suing the agency with the claim that the procurement was "arbitrary and capricious, an abuse of discretion, and otherwise contrary to law."

The Department of the Interior eventually dropped plans to use the Microsoft solution, and Google responded by withdrawing its lawsuit. Rather than carrying a grudge against the search giant, the Interior Department responded by becoming one of Google´s biggest cloud customers in the government sector.

Under this contract the agency will consolidate its emails services into a single system, as it sees its 90,000 email users move from servers provided by Lotus Domino and Microsoft Exchange, as well as numerous instant messaging and collaboration apps, to Google´s cloud email and collaboration services. By the end of 2012 the email boxes will be moved to Google Apps for Government.

Users at the Department of the Interior will have access to the new system from desktop computers as well as mobile devices.

"This award is a great example of how our IT Transformation initiative is already delivering value to the department," said secretary of the interior Ken Salazar in a statement. "Implementing a department-wide, cloud-based email system that helps modernize the ways we do business while cutting costs is good government, plain and simple."

Google entered the enterprise computing space nearly six years ago with the launch of Apps for Your Domain, and originally offered the product for free to businesses, government agencies and educational institutions.

Following the decision to award the contract to Google reseller Onix Networks, Microsoft responded with a statement:  "Microsoft has a positive, longstanding relationship with the Department of Interior and we are working on a number of enterprise-wide initiatives with the agency. Although we are disappointed by this award, we will engage with our partners and DOI to review and understand the reasons for this decision."

The Interior Department also follows several other government agencies in the move to the cloud, as the General Services Administration, Department of Agriculture, the Lawrence Berkeley National Lab, and the National Oceanic and Atmospheric Administration have made the shift for their email respective services, the Department of Veterans Affairs has also considered a move.