September 2, 2009 By Steve Towns, Editor
Photo: Michigan CIO Ken Theis
Within weeks, Michigan will take the first step toward building a massive data center designed to provide cloud computing services to state agencies, cities, counties and schools across the state.
Michigan's Department of Information Technology will release a request for information (RFI) in September to gather ideas and gauge industry interest in forming a public-private partnership to build and operate the facility, according to state CIO Ken Theis. The state intends to break ground on the data center project in October 2010.
"This is really big for us," said Theis, in an interview with Government Technology. "It could potentially be an 80,000- to 100,000-square-foot data center. And we're not only looking at it from a shared-services and cloud computing perspective, we're also looking at this for economic development."
Theis said the new facility -- dubbed the Great Lakes Information and Technology Center -- would cut the cost of running government by reducing the number of duplicate computer systems operated by cities, counties and state agencies. The plan envisions a public-sector cloud that would offer application hosting and managed services to any public entity in Michigan.
In addition, the data center is being positioned as a magnet for technology related economic development and as a potential alternative to offshore application hosting and storage for private companies.
Theis said there's huge demand for application hosting and managed services among local governments in Michigan, which has been battered by the decline of domestic auto manufacturing and other economic factors.
"The state government is hurting, and the local governments are hurting even more," he said. "So the heart of our cloud computing strategy is not a state of Michigan cloud, but a public-sector cloud, and there's a ton of interest in it."
The government cloud is the next step in Michigan's consolidation of state IT staff and resources. Since 2004, Michigan shut down 35 of 38 data centers and repurposed nearly half of its existing IT equipment. The Michigan Department of Information Technology now provides standardized backup, storage and other enterprise services to state agencies.
Michigan's consolidation efforts have saved more than $19 million and reclaimed 30,000 square feet of office space, according to the state. The new data center will replace two of three remaining data centers operated by Michigan state government.
"If you look at the power of what we did and the money we saved within state government boundaries, think of the power of expanding that out to other public-sector entities," said Theis. "We're going to save local government and other public entities a ton of money by standardizing their environment for them."
Michigan will tap funds from the American Recovery and Reinvestment Act and other sources to make the facility as green as possible, said Theis. Energy efficiency will be a key to the new data center's success as an engine for economic development, he added.
Michigan officials expect the new facility to become a magnet for employers by offering low-cost hosting for startup companies. In addition, an extremely efficient Michigan data center could be a competitive substitute to offshore hosting for established companies.
"No private-sector CIO wants to offshore, but right now there's not really a good alternative. And they have the same problem now as government does: They don't have any money," Theis said. "We'll give them what I call a second-tier solution. First tier is an on-site data center. Third-tier is offshore hosting. This is a second tier. It won't be as cheap as offshore, but a lot more reasonable than having folks on site."
This Digital Communities white paper highlights discussions with IT officials in four counties that have adopted shared services models. Our aim was to learn about the obstacles these governments have faced when it comes to shared services and what it takes to overcome those roadblocks. We also spoke with several members of the IT industry who have thought long and hard about these issues. The paper offers some best practices for shared government-to-government services, but also points out challenges that government and industry still must overcome before this model gains widespread adoption.