UPDATED 14:02 EDT / DECEMBER 21 2016

INFRA

Microsoft lands $927M tech support deal with US Defense Department

Professional services don’t come up nearly as often during Microsoft Corp.’s earnings calls as Office 365 or Windows, but they’re nonetheless an important revenue source for the company, especially in the public sector.

The technology giant on Monday won a landmark technical support contract from the U.S. Department of Defense that is worth $927 million. Under the deal, Microsoft will provide the department with assistance in deploying and maintaining its products in government facilities. The press notice in which the deal was announced didn’t specify exactly what products are involved, but there’s plenty of room for speculation.

One factor to consider is that the DoD recently revealed plans to upgrade some 4 million devices to Windows 10 by February 2017. Although the department and the agencies under its supervision have plenty of technical resources at their disposal, updating so many machines is still a monumental task that could be made a lot easier with Microsoft’s help. And that’s not mentioning all the cloud services that the defense community buys from the technology giant.

The company’s Azure platform in particular is so popular that it introduced a specially built edition for the DoD a few months ago. And Office 365 has similarly been certified for a number of security standards that technology products must meet before they can be adopted by the government.

Microsoft has already been providing support for its products to the DoD as part of a $575 million contract that was signed in 2013 and extended last year. Like its predecessor, this week’s $927 million agreement will see the technology giant provide access to “highly-trained Blue Badge Cardholder” staff. Ars Technica noted that this term refers to the company’s internal engineers as opposed to the outsourced contractors hired for lower priority projects, who typically wear orange IDs.

Finally, Microsoft will provide the DoD with access to the source-code of its products to help meet operational requirements. The agreement is set to last for five years but may very well be extended like the previous $575 million contract.

Image via Pixabay

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