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AWS agreement to accelerate IT transformation and AI

innovation

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Federal agencies to access AWS training and resources

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Pentagon awarded $9 billion in cloud contracts to major

tech

firms in 2022

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AWS supports over 11,000 government agencies globally

(Updates with Amazon ( AMZN ) comment, more details, background in

paragraphs 3-11)

By David Shepardson

Aug 7 (Reuters) - Amazon Web Services has agreed to

provide U.S. government agencies with up to $1 billion in

savings for cloud adoption, modernization and training through

the end of 2028, the U.S. General Services Administration said

on Thursday.

The agency said the agreement with the unit of Amazon.com ( AMZN )

"will accelerate large-scale IT transformation across

government and spur AI innovation."

A government report in March said the federal government

annually spends more than $100 billion to manage IT systems,

acquire new systems, or update old ones.

Amazon ( AMZN ) has won billions of dollars in contracts to help federal

agencies transition to the cloud and for other services. The

U.S. government has struggled for years to modernize its aging

IT systems.

The agreement offers up to a total of $1 billion in direct

incentive credits in total across Federal civilian agencies

including savings on core AWS cloud services, modernization and

training credits.

"This landmark agreement marks a significant milestone in

the large-scale digital transformation of government services,"

said AWS CEO Matt Garman.

Federal agencies will have access to AWS training resources

and experts to help them move to the cloud. AWS supports more

than 11,000 government agencies worldwide.

The deal between GSA and AWS aims "to reduce the cost of

federal IT expenditures, save taxpayer dollars, drive innovation

and agility in new government services, and secure America's

continued leadership in AI," the government said.

In 2022, the Pentagon awarded $9 billion worth of cloud

computing contracts to AWS, Microsoft Corp ( MSFT ), Alphabet

Inc's ( GOOG ) Google and Oracle Corp. ( ORCL )

The Joint Warfighting Cloud Capability was the multi-cloud

successor to the Joint Enterprise Defense Infrastructure (JEDI),

an IT modernization project to build a large, common commercial

cloud for the Defense Department.

Amazon ( AMZN ) during Trump's first term sued after the $10 billion

JEDI contract was awarded to Microsoft ( MSFT ). Amazon ( AMZN ) said Trump

exerted improper pressure on military officials to steer the

contract away from the company.