Google to agree cloud discount as US government squeezes Big Tech

Open the newsletter to watch the White House for free

Your guide to what the second period of Trump means to Washington, business and the world

Google will significantly deduct cloud computing services to the United States government, as Trump administration technology groups pressure reduce prices on long -term profitable contracts.

The agreement comes after Oracle last week highlighted a deal with the government, including 75 percent discount on some software contracts for a limited period and “big discounts” on broader cloud computing contracts.

The cloud contract of Google is likely to be “landing in a similar place”, according to a senior official in the Public Services Department (GSA), which re -negotiates the contracts. The deal is expected to be completed within weeks.

They said that equivalent discounts from Microsoft’s Azure and Amazon Web Services (AWS) is expected to follow soon, but these conversations are less advanced than Alphabet, the parent company of Google.

“Each of these companies is fully purchased, they understand the task,” said a senior official. “We will get there with all the four players.”

The four companies together represent the largest part of the government’s annual spending on cloud services, which currently exceed $ 20 billion annually.

President Donald Trump’s administration is trying to reduce the cost of purchasing information technology as part of an effort at the government level defended by the Ministry of Government efficiency (DOGE), which was previously managed by Elon Musk.

Technology giants are keen to avoid repeating the hostile relationship they had with Trump during his first term, which witnessed that AWS was losing a profitable defensive contract.

Amazon claimed that this step was a revenge for the critical coverage of the administration in the Washington Post, owned by the founder of the company, Jeff Bezos.

Payment from GSA, which coordinates US government purchases, follows similar efforts by the Trump administration to reduce the amount spent on consulting groups such as Boz Allen Hamilton and Deloitte.

The senior official said that GSA will also operate agreements with companies participating in Rideshning with contracts with the federal government.

Google has agreed to grant the US government a “temporary price reduction” by 71 percent over some work area contracts in April, until the end of September. The company refused to comment on the suspended cloud deal.

Microsoft rejected the comment. Amazon and Oracle did not respond to suspension requests. A GSA spokesman refused to comment on the ongoing negotiations.

The agency -saving efforts at the agency, which is led by official Stephen Ikian and Federal Service Commissioner Josh Grinbom, follows a series of executive orders signed by Trump that provides for money saving in federal purchases.

In the past few months, GSA has reached deals with Adobe and Salesforce. The last company reduced the price to the government to use Slack Srack Slack by 90 percent until the end of November.

The adult technology leaders, including Meta from Marc Zuckerberg and the Google Sundar Pichai, operated Trump – he appeared prominently in his installation and finishing corporate diversity programs.

Bezos also worked to rebuild his relationship with the president – who previously criticized him as a “threat to democracy”.

During the first period of Trump, in 2019, the cloud project was granted for infrastructure infrastructure (Jedi) infrastructure (Jedi), instead of Amazon. AWS claimed in a lawsuit that Trump “used his” authority to the Amazon “because of” a very large personal revenge “against Bezos and Washington Post.

Ultimately, Jedi was canceled under Joe Biden and replaced with a $ 9 billion contract that was granted to Amazon, Google, Microsoft and Oracle.

Larry Ellison, the founder of the billionaire in Oracle, has a close alliance with Trump. Oracle participates in talks to divide the VIDEO app for American Tiktok business from Chinese parents, which is part of the US data data infrastructure project worth $ 100 billion alongside Openai.