AWS' reach into the public sector is significant enough that it holds a yearly conference geared toward government...
customers. The public cloud entity also provides a purpose-built government public cloud region, AWS GovCloud, for those U.S.-based users. Still, it begs the question "How large is AWS' public sector footprint?"
According to Keith Brooks, business development manager at AWS, 2,300 government agencies, 7,000 education institutions and 22,000 nonprofit organizations had adopted GovCloud by 2016. And the AWS GovCloud region showed sharp growth in addition to those numbers, flashing a 221% year-over-year growth in the U.S. since its 2011 launch.
AWS GovCloud provides public cloud servers for storage and compute that host sensitive data and processing. Public sector users value compliance with these types of cloud services; it supports most of the relevant standards and adherence to the law, including International Traffic in Arms Regulations and Federal Risk and Authorization Management Program.
AWS sees its clients focus on a few core business requirements, such as those with sensitive data and applications with strict regulatory and compliance requirements. These customers also need to be able to restrict community cloud configurations.
But AWS GovCloud is not just for the U.S. Government; the region is available to vetted contractors and organizations that exist in regulated industries. For example, government contractors who need to secure sensitive data or others who need their own place on a very large cloud can join GovCloud.
Of course, customers don't have to use the AWS GovCloud; they can use traditional AWS regions. There is no restriction for those who want or need to use GovCloud. While it's built for the government, AWS allows traditional corporations to use the region as well, though government contractors will find it most useful.
Value, security reel in former cloud skeptics
AWS overall growth has also been impressive. The cloud provider grew 47% with earnings of $3.53 billion and a $14.2 billion run rate in 2016. AWS does not break out its public sector revenue, but it's a fair guess that AWS GovCloud provides about 20% of its business worldwide -- with most centered in the U.S.
While that seems like an impressive number, the public sector has been slow to adopt the cloud. Cloud skeptics often mention security and compliance issues as a no-cloud excuse. Over time, however, many government agencies determined that a move to AWS and other public clouds includes compliance and security upgrades, such as identity-based security and advanced encryption.
CIOs push back on cloud more often because of financial issues than technical issues. For most agencies, it costs millions of dollars and years of time to complete a migration to the cloud. The necessary funding to run existing operations during the migration might not exist.
Compare this to 2009, when the government was actually ahead in cloud adoption. That year, the National Institute of Standards and Technology published its definition of cloud computing, including information for platform as a service, software as a service and infrastructure as a service, as well as public, private, hybrid and community clouds. One agency CIO, who asked to remain nameless, declared a "cloud-first" strategy for the U.S. government, but adoption did not dramatically increase, as government politics, money and migration difficulties stood in the way.
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Currently, the U.S. government is back onboard the cloud computing bandwagon. Public clouds such as AWS offer better value than some on-premises software and maintenance efforts, and U.S. agencies are taking note. We're seeing more government procurements that include public clouds. While these deals are relatively tactical in nature, the public sector is likely to find its strategic footing within the next few years. And AWS stands to benefit.
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