Oracle (ORCL, Financial) is significantly reducing the prices of its software and cloud services for federal agencies, joining other tech giants in offering substantial discounts to the U.S. government. The General Services Administration (GSA) disclosed that Oracle's licensing software will see a 75% price cut, while its cloud platform will receive a "significant" discount. This agreement aims to save on cloud infrastructure costs across the government, a crucial component of modern IT systems. The GSA is also negotiating similar deals with other cloud service providers.
Earlier, Salesforce (CRM) reduced the government usage price of its Slack communication software by 90%, and companies like Google (GOOGL), Adobe (ADBE), and Elastic have also introduced software discounts. These initiatives align with the U.S. government's strategy to modernize federal technology and control costs. Oracle's agreement includes AI service access and technical support for cloud migration, as the company continues to expand its federal business footprint.
In 2022, Oracle secured a major Pentagon cloud service contract alongside Amazon (AMZN), Google, and Microsoft (MSFT), thanks to its competitive pricing strategy. The new agreement allows the Department of Defense to benefit from Oracle's cloud service discounts as well. Oracle's cloud business is expected to grow by 40% this fiscal year, indicating potential breakthroughs in this competitive sector.
