[Infowarrior] - Government to Pull Plug on 137 Data Centers

[Richard Forno]

Government to Pull Plug on 137 Data Centers
By DAMIAN PALETTA

http://online.wsj.com/article/SB10001424052748704729304576287431386089352.html

The Obama administration will unveil plans Wednesday to shut 137 of the 2,094 federal data centers by the end of the year, a move that officials see as a breakthrough in their effort to make the government's information-technology infrastructure more efficient and less costly.

The closures would affect 16 federal agencies, including the Pentagon and the State Department, in nearly every corner of the U.S., from Boston to Anchorage, Alaska, according to the White House plan.

Administration officials said that they didn't have an estimate of how many government and contractor jobs might be cut as a result.

The number of federal data centers has grown rapidly in recent decades, up from just 432 in 1998. But White House officials said many of the centers ran over budget and were underutilized.

The Obama administration began planning to pare back data centers in February 2009, soon after President Barack Obama took office. The process proved complicated because it took months for officials to determine how many even existed.

The plan aims to close a total of 800 centers by 2015, which officials project would save $3 billion annually. The proliferation of facilities was the target of a Government Accountability Office report in March, which described them as a prime example of duplication and overlap in federal bureaucracy.

"Projects run over budget, they fall behind schedule, and they fail to deliver their promised functionality," said Jeffrey Zients, the White House's chief performance officer. "That's clearly unacceptable."

Data centers facilitate computer processing; they can be used for data storage, networking or housing servers. White House officials believe the number of facilities, spread out across many different agencies, is inefficient.

The government spends roughly $450 million on electricity for the centers, and White House officials estimate that 27% of a typical data center is utilized, far lower than averages for private-sector counterparts.

Consolidating data centers is part of the White House's broader effort to reduce the growth of government and spending, something critics have said the administration hasn't moved quickly enough to address. The government spends roughly $80 billion a year on information technology, just a fraction of overall federal spending, but officials believe roughly $24 billion of that amount is spent on data centers and their operations.

Many White House proposals to reduce the deficit, such as an overhaul of the tax code or eliminating certain Pentagon projects, require congressional approval. But the executive branch has more direct influence in the operations of federal agencies, making it easier to carry out the data-center consolidation. Still, such a move could face political resistance from lawmakers seeking to protect jobs at data centers in their districts.

"We do expect, obviously, in the coming months and years to make some of those really tough decisions where we would have to work really close with Congress to shut down data centers that frankly don't make sense," said Vivek Kundra, the government's chief information officer.

The administration has already shut 39 of them, with 98 more to be closed by year's end.

Before the reductions began, the Pentagon had 772 data centers, far more than any other agency, according to the government. Of the total closures, 57 will be within the Defense Department, 18 in the Department of the Interior and 14 in the National Aeronautics and Space Administration.

Write to Damian Paletta at damian.paletta at wsj.com