Score one for Google and The Cloud.
The Los Angeles City Council today voted unanimously to “Go Google,” approving a $7.25 million contract to outsource the city’s e-mail system to Google’s cloud and transition some 30,000 city employees to the cloud over the coming year, according to a report in the Los Angeles Times.
Clearly, this is a big deal for the city of Los Angeles. But this vote is also monumental for cloud computing as a whole, which has gained popularity and widespread interest but still relatively little adoption as companies - and municipalities, apparently - weigh the anticipated cost benefits over the unknown risks that might come with system failures or data breaches.
The stakes are also high for Google, which has stepped up its campaign for Google Apps, its cloud-based suite of offerings, by highlighting how companies who are fed up with breakdowns and costs of maintaining old legacy systems finally decided to “Go Google.”
Both Google and Microsoft had put in bids for the city’s contract and, at one point, it seemed to be a showdown between the two, representing a bigger winner-take-all battle between old school systems and 21st Century cloud systems. In a post last month, I suggested that a win for Microsoft would show that Outlook and Exchange are still big players and that a win for Google would show that the cloud is ready for prime time.
This doesn’t necessarily mean the beginning of the end for Microsoft in this space. Los Angeles is just one city on this planet - and it’s only 30,000 city employees. But Google clearly has its sights set on the enterprise for the next wave of growth, even to the point that it could overtake - or nicely complement - the advertising business.
At the Gartner IT Symposium 2009 in Orlando earlier this month, Google CEO Eric Schmidt said the largest number of seats for Google runs about 30,000 users and that goal right now is to gain users for its enterprise apps. He sees the enterprise as “humongous,” a multi-billion dollar business that has real potential. By Gartner’s calculations, enterprise accounts for about 3 cents of every dollar that Google makes, leaving plenty of room for growth.
That growth could come from the countless other municipalities, agencies and companies that have been toying with the idea of a move to the cloud but have held back, waiting for someone else to jump off the cliff first.
That’s what happened in L.A. today
