On Tuesday, the City of Los Angeles city council voted unanimously in favor of a $7.25 million contract to outsource its email and document application system to Google. This is a HUGE milestone for cloud computing and a giant coup for Google.

Acknowledging that Google's email system is not yet proven on a scale of the the City of LA, the city council decided to move forward because of the crash-prone nature of their existing Novell GroupWise email system and concerns about communications during a major disaster. Google's security also was felt to be better than that which the City could currently provide.

I see City's decision being significant because it indicates the direction that technology is trending: toward cloud computing and away from self-hosted applications running on numerous servers that require a large maintenance and administration cost. Self-hosted servers also have large power, air conditioning, and disaster recovery requirements.

I expect that other municipalities and large institutions will soon follow suit now that the City of Los Angeles has taken the plunge into cloud computing.

The $7.25 billion contract will be implemented over 5 years beginning June 2010. The contract will provide Google Apps which include email, spreadsheets, word processing, presentation, and document storage to the City's 30,000 employees.

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