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IBM agrees to offer discounted cloud pricing to UK government buyers

IBM has joined a growing list of tech firms offering cloud computing services at a preferential rate to buyers across Whitehall and the wider public sector.

The US firm’s three-year deal has been established by the Crown Commercial Service (CCS) as part of a plan to boost competition in the public sector cloud market.

UKCloud, Google, Microsoft and Oracle are among those to have already signed up to the initiative, which sources say was created to resolve concerns about vendor lock-in and a shortage of competition in a market dominated by Amazon Web Services (AWS).

As NS Tech reported last month, the US retail giant’s cloud computing arm, which is also likely to sign up to the initiative, has won more than £100m in public sector deals through the government’s Digital Marketplace in recent years. But some other suppliers, including Google, hadn’t won any deals through the marketplace before the new terms were agreed.

IBM, however, is already one of the largest suppliers of technology to government and the public sector. It has secured nearly £200m of deals in the last eight years, although this encompasses a range of technologies beyond cloud. It won £70m of public sector business last year alone, according to the government’s Digital Marketplace spend data.

The company supplies services to a numbers of government departments and agencies, including the Home Office, Met Office and Ministry of Defence (MoD), among others. Last year the MoD contracted the US firm to build a prototype AI software platform worth £4m. If the prototype is successful, it could materialise into a substantially larger deal later this year.

Expenditure (in pounds) with IBM through the government’s Digital Marketplace.

Simon Tse, chief executive of the Crown Commercial Service (CCS), said: “CCS provides commercial agreements which help organisations across the entire public sector save time and money on buying everyday goods and services. This agreement with IBM provides great value for public sector organisations as they continue to innovate and improve essential services for citizens throughout the UK.”

Janine Cook, IBM UK and Ireland’s vice president for public sector, added: “As the public sector continues its rapid digital transformation, government organisations crossing many industries need a reliable, resilient and secure technology environment to meet the needs of citizens and address complex security and regulatory requirements.

“An open hybrid cloud platform, built and managed with IBM’s deep industry expertise, can allow the public sector to accelerate its innovation and offer a more agile way to develop new digital services and take the next step along their cloud journeys.”