Federal IT Modernization Report

Federal IT spending continues to grow, reaching nearly $100 billion annually across all agencies.

Spending Breakdown: - Defense IT: ~$50 billion - Civilian IT: ~$50 billion

Investment Categories: - Development, Modernization, Enhancement (DME): 30% - Operations & Maintenance (O&M): 70%

Key Trends: - Legacy system modernization accelerating - Cloud-first policies driving migration - Cybersecurity receiving increased funding - AI/ML adoption expanding rapidly

Cloud migration remains a top priority across federal agencies.

Market Size: Federal cloud spending approaching $10 billion annually, with projected growth of 15-20% per year.

FedRAMP Progress: - 300+ authorized products - Growing authorized services catalog - Streamlined authorization processes

Multi-Cloud Strategy: Agencies increasingly adopting multi-cloud approaches: - AWS GovCloud - Microsoft Azure Government - Google Cloud Platform - Oracle Cloud Infrastructure

Key Opportunities: - Cloud migration services - Cloud security and compliance - Cloud-native development - Multi-cloud management - Edge computing integration

Cybersecurity spending is growing faster than overall IT budgets.

Federal Cybersecurity Budget: Over $20 billion allocated to cybersecurity across government.

Zero Trust Mandates: Executive Order 14028 requires agencies to achieve specific zero trust maturity levels.

Key Investment Areas: - Identity and access management - Endpoint detection and response - Network segmentation - Security operations centers - Threat intelligence - Incident response

CISA Role: Cybersecurity and Infrastructure Security Agency (CISA) providing government-wide services and leading coordination.

Agencies are investing in next-generation capabilities.

Artificial Intelligence: - Process automation - Natural language processing - Predictive analytics - Computer vision - Decision support systems

Data & Analytics: - Big data platforms - Real-time analytics - Data governance - API integration - Machine learning operations

Automation: - Robotic process automation - Intelligent automation - Workflow optimization - DevSecOps pipelines

Other Areas: - 5G network adoption - Internet of Things (IoT) - Quantum computing research - Blockchain pilots

IT modernization priorities vary by agency mission.

DoD: - JWCC cloud environment - Zero trust implementation - AI for warfighting - Data-centric architecture

VA: - EHR modernization - Telehealth expansion - Benefits system updates - Customer experience

HHS: - Medicare system modernization - Public health data infrastructure - Research data management - Interoperability

DHS: - Cybersecurity services - Border technology - Identity management - Emergency communications

GSA: - Login.gov expansion - Cloud.gov platform - Technology Modernization Fund - Shared services