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Amazon and Microsoft just scored a huge $100 million cloud deal that can't be making IBM too happy
(Michael Seto/Business Insider)
Jeff Bezos.
Amazon and Microsoft are quickly becoming the king and queen of cloud computing.
Here's another case in point: The two of them just won a huge contract with the Federal Aviation Administration, led by IT consultant CSC. This contract will consolidate the FAA's data centers, moving data to Amazon's cloud Amazon Web Services and Microsoft's cloud, Azure.
CSC says the contract is worth $108 million out of the gate, and because it's a long-term contract, could be worth as much as $1 billion over the next 10 years.
But the FAA isn't getting rid of its data centers altogether to run on AWS and Azure, although that's increasingly becoming a thing huge companies like Netflix and Yamaha of America are doing — both of which are using AWS.
The FAA is just trying to shrink its data centers and use the two clouds as much as it can — a type of cloud computing known as "hybrid computing." A lot of big organizations are moving toward hybrid computing these days, rather than ditching their own data centers altogether.
The most interesting thing about this announcement: IBM was left out in the cold.
IBM and the FAA have a long and storied relationship, stretching back decades. That's not to say the FAA is dropping its relationship with IBM completely, but it's interesting that of the two clouds FAA chose for this huge consolidation project, IBM didn't make the cut.
IBM is battling big time for its share of the huge-and-growing cloud computing market and is currently placed third, according to Synergy Research.
But Amazon is killing it when it comes to winning business from government agencies with extreme security needs. A couple years ago, it famously won a contract to build a new cloud for the CIA out from IBM.
That cloud has become a big winner, not just for Amazon and the CIA, but all the intelligence agencies are reportedly loving this new cloud, Fortune's Barb Darrow reported.
And, as we predicted in 2013, that win meant Amazon would be in good standing with other government agencies, not to IBM's benefit.
IBM had no comment on the FAA contract but a representative told us: "Through the second quarter of 2015, IBM's cloud revenue was $8.7 billion on a trailing 12-month basis, growing 70%. And IBM's government cloud business is robust and growing."
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