Late yesterday, the United States Department of Defense announced a new agreement with Microsoft and Dell aimed at consolidating and simplifying Microsoft software licenses for various services and systems.
If you’ve ever worked for a large government department or corporation, you know how complicated IT policies can be. Additionally, you may be aware of how tangled and convoluted systems can become over time as a result of decades of technical debt piling up and accumulating. We’re all running the latest version of Windows 11 at home, but your local airport, hospital or bank is still rocking. Windows 7even older in some cases.
Few government departments are as complex as the United States military apparatus. Microsoft has long had contracts with the Pentagon to deliver things like Windows. Microsoft Officeand cloud services. Over time, the disparate cacophony of different clauses, licensing models, and service level agreements has become a tangled web of unnecessary complexity and ongoing maintenance requirements. The Pentagon is taking measures to cut costs, at least in theory.
The US Department of Defense announced that over the next five years, Dell will be tasked with integrating and improving Microsoft services and software deployed across the US military, including intelligence services and the US Coast Guard.
The Pentagon (via CNBC) says the deal will save U.S. taxpayers $422 million annually, despite the initial $9.7 billion cost of the cleanup operation.
Dell has a long-standing partnership with Microsoft as one of the largest PC manufacturers on earth and a third-party provider of Microsoft services and licenses. Although the deal ultimately goes to Dell, it further cements Microsoft as a major software and cloud provider for the US government.
dubbed “Microsoft Department of War Enterprise Software Agreement II Major Enterprise Technology Agreement”, The funds reportedly come from existing budgets already set aside for Microsoft software purchases, which include the Office suite and things like Azure servers and Active Directory. The goal is to centralize software procurement into a single, more efficient tool, as opposed to the current system of disparate and conflicting processes.
Dell shares hit an all-time high of $305 during after-hours on the news. Dell’s stock price is up 129% in just six months and is tracking comments US President Trump is urging people to do this “go and buy a Dell” Along with Michael Dell $6.5 billion in donations to a Trump-backed charitable investment fund for America’s children.
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