US CTO Delivers Shopping List to IT Execs

UPDATE: Washington will spend billions on products and services that solve problems of interoperatbility, security and redundancy, a top government technology official told industry groups.

The federal government's new business-like approach to IT offers "unlimited opportunity" for companies of all sizes, Norman Lorentz, the federal government's chief technology officer told Silicon Valley leaders during a forum sponsored by the technology trade association AeA.

"We need (the private sector) to provide solutions that solve business problems," said Lorentz, whose day job is as CTO for the U.S. Office of Management and Budget, spoke on Thursday to the AeA , which counts over 3,000 technology companies as members for which it lobbies the government on technology policy.

One of the key problems is communications between agencies and their disparate computer systems, a shortcoming that was painfully exposed on Sept. 11, 2001.

"The homeland can only be secure if all the dots connect," said Lorentz, who is also who active in streamlining government offices with more efficient uses of technology. "The local, state and federal government connection needs to be indelible."

Interoperability must be a part of any technology the federal government buys, he said. In addition to the free flow of information, compatible systems will allow future federal IT managers to move equipment where it is most needed.

For example, the government is currently evaluating the systems of the agencies that are being merged to form the Department of Homeland Security. The task would not be less daunting if everything was compatible.

This openness must be balanced, however, with security, especially for software and hardware aimed at the Department of Defense and intelligence agencies.

Lorentz conceded that Washington has done a poor job of assessing and implementing emerging technologies. This is an area where startups can win contracts, even if they haven't done business previously with the federal government.

Finally, IT outsourcing will likely spend billions on IT outsourcing in coming years. A high percentage of government IT workers will be eligible for retirement over the next five years, Lorentz said. And the government will look to farm out jobs to the private sector to save money.

Some larger systems integrators and IT firms, including IBM, EDS, CSC (which announced a slew of public sector deals over the last two days) are already benefitting from the trend.

Greg Baroni, president of Unisys' government unit, said his company is working on a large project for the Transportation Security Authority (TSA),

"They are not going to have arms and legs to go out and map a new system," Baroni said. "(Hiring us) lets them focus on their mission and creating a culture of security."

James Kane, president and CEO of the research and consulting firm Federal Sources Inc. (FSI), who also spoke at the event agreed that the Bush administration's IT strategy could be a boon for the tech sector.

"The Office of Management and Budget (which handles IT buying decisions) is looking at techology as an investment," Kane said. "It's a corporate mindset that has been brought to Washington that makes it a better mactch for companies."

Despite the mounting deficit, FSI predicts the federal government market will be "extremely strong" for the next two years, with overall IT spending creeping up toward 9 percent compound growth.

"I challenge you to find another vertical like that," Kane said.

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