US technology consolidation not expected to dampen cloud spending

Thursday, August 04, 2011

Although the U.S. government hopes to curb spending to relieve the immense budget deficit, spending for cloud computing is not expected to dwindle, according to a recent Seeking Alpha report.

The cloud is projected to play a major role in saving the government money by consolidating its servers and IT spending. As a result, cloud service providers stand to benefit with the increased investment in the technology.

"But with such a focus on cutting spending recently, the government has a bit more pep in its step," said Seeking Alpha's Justin Dove. "The beauty of the situation for IT companies is that most of the savings will come from lower energy needs, less hardware and less real estate required for the data centers."

While the U.S. government hopes the cloud will help lessen its technology spending, companies are investing in the solution more than ever. According to research firm Gartner, global spending on public cloud computing is projected to reach $89 billion this year and more than double to $177 billion by 2015.