Wall Street Loses, Google Gains in Government

(Compiler's note: Interesting read)

By Anne Laurent

Ugh. That giant sucking sound again, this time as millions of us hear our retirement savings swirl down the drain.

Despite the bailout blow-out, my mind has kept wandering all day to a Washington Post story about Google's new office, of all things. Finally, Bob Gourley, former chief technology officer at the Defense Intelligence Agency, helped me understand why.

Google's clearly moving to Washington (actually Reston, Va., but it's the same thing) to get serious about selling to government and the contractors arrayed around it. I've written about its new Google Video for business (YouTube for the Enterprise) and how logical I believe it will be for agencies to adopt. But of course there's a whole array of other apps surrounding that one: Google Earth, Google Maps, Google Docs, enterprise search, Web browser and Google's server cloud, where more and more businesses find it safe enough to store their data.

When Google first announced its foray into government, I thought it was a big deal -- the revival, but this time for keeps, of software as a service. But after a flurry of PR about improving enterprise search and indexing data for agencies, things seemed to calm down.

Wall Street's meltdown is going to heat them back up big time, according to Gourley, who now runs Crucial Point LLC, a tech consulting firm, and "CTO Vision," a terrific blog. That's where I found his musings on the meaning of the meltdown for federal IT folks.

The whole post is worth reading, but the big takeaway for me was that financial companies clearly won't be spending on IT in the near future, nor will agencies, especially if IT doesn't provide critical value. And increasingly it doesn't since it's rapidly becoming a utility (a la Nicholas Carr), and should mostly be outsourced.

And to whom? Well, one idea might be Google. Agencies already are moving. The Post highlights the District of Columbia, where CTO Vivek Kundra has employees using Google's spreadsheets, email, videos, maps, word processing and a wiki. Alabama has won many plaudits and imitators with its amazing mash-up of Google Maps, Virtual Alabama.

And on and on. My point being that once again, everybody's loss might turn out to be Google's gain.