Federal Data Center Optimization Initiative Progress, FY 2020

Published: January 13, 2021

Data Center

In late December, fourth quarter FY 2020 data center statistics were posted to the IT Dashboard finalizing FY 2020 fiscal year-end data center numbers and showing progress to date.

Since 2010, the federal government has made a concerted effort to consolidate and optimize data centers. In FY 2016, OMB launched the Data Center Optimization Initiative (DCOI). In June 2019, OMB updated the guidance for the initiative to more closely align it with FITARA objectives and refocus efforts on projects that drive the most cost savings and return on investment (ROI).

Over the years, OMB repeatedly extended data center consolidation and optimization deadlines, most recently to September 30, 2022.  The National Defense Authorization Act for Fiscal Year 2020 extended data center requirements through October 1, 2022. As a result in November 2020, OMB released a memo extending DCOI requirements to September 30, 2022.

The IT Dashboard does not give definitions or explanations for the numbers presented. Instead, the information is left to user interpretation. The dashboard data shows that the “total” number of data centers has decreased over the last several years.  This is likely due to the change in definition of a data center precipitated by the new DCOI guidance made final June 2019. Additionally, the new guidance established Key Mission Facilities (KMF) allowing agencies more latitude in requesting exemption from consolidation requirements.

The chart below is described as data center closures for all facilities.  The dashboard notes that definitions changed and KMFs were added in Q4 FY 2018. We are also left to assume that “closed” must mean the cumulative number of data centers that have been closed over time and that the reason the number has gone up and down is due to the change in the definition of a data center.

The following chart shows the closures for valid tiered facilities.  According to June 2019 DCOI guidance, a valid tiered facility is a “purpose-built physically separate and dedicated space.”  Again, it appears that “closed” and the “closure goal” are cumulative numbers, not the number of data centers closed in each individual year.

The chart below shows the number of regular data center compared to the number of KMFs for the agencies with the most data centers. 

The chart below shows the number of current closures compared to the closure goal for the top federal departments.

The chart below shows data center counts by tier. 

The following chart shows data center counts for tiered KMFs by their facility type.

Agencies reported total costs savings of $120M for data center optimization efforts in FY 2020.  This is short of their goal of $766M in cost savings for the time period. There is no cost saving goal specified for FY 2021.

According to the data and the chart below, the number of cloud instances dropped in FY 2020, the number of virtual hosts increased, and the percentage of virtual hosts to servers declined. 

According to the data, the number of facilities with energy metering capability is on the rise, along with the percentage of facilities with metering capability. 

Although the DCOI effort has lost some momentum, federal contractors should continue to see opportunities to assist agencies with data center consolidation and optimization efforts. Opportunities exist in the areas of application rationalization, infrastructure modernization, cloud migration, and shared service migration.