LA Story: Google Wins Big E-Mail Contract

Google has won qualified approval to replace the city of Los Angeles’s aging e-mail system with Gmail and other applications in the search giant’s suite of cloud-based services.

City Council members voted unanimously on Tuesday to pay $7.25 million over five years for services giant Computer Sciences Corp. (CSC), the contractor in the deal, to implement a system by June 30, 2010 that will include e-mail and other Google (NASDAQ: GOOG) applications, including document archiving, spreadsheets, presentations, virus detection, disaster recovery and additional storage, according to a report in the LA Times today.

“We’re thrilled the LA City Council unanimously voted to go Google, and we look forward to working with the City to bring the many benefits of Google Apps to their employee,” said Dave Girouard, president of Google Enterprise, in a statement e-mailed to

However, the city council amended the original contract so that CSC would have to pay a penalty if there was a security breach affecting city data. While the Times reports no one from CSC at the meeting objected, the computer services giant has to sign off on the new provision which, sources close to the company say, is expected to happen.

The deal, which covers over 30,000 users, is a high profile win for Google. It has promoted its suite of cloud-based applications as a cheaper, more flexible alternative to traditional on-premises applications like Microsoft Office.

The City Council rejected a proposal to test the Google-based system in a single department and evaluate it over six months and also rejected a proposal to upgrade the current GroupWise system from Novell, according to the LA Times.

Saving on hardware

City Administrative Officer Miguel Santana said staying with GroupWise would cost the city $5.4 million more over five years than switching to a Google-based system. The Times also quotes Santana as saying the GroupWise system has a record of being unreliable and that its e-mail program was down as recently as Monday.

City officials said the GroupWise system requires 90 dedicated servers operated by 13 staffers at a cost of about $23 million over five years. With Google’s cloud-based system, applications and data are stored and managed remotely in Google’s datacenters, which has proved mostly reliable though there have been some isolated disruptions.

The non-profit group Consumer Watchdog opposed the deal over security concerns.

“Los Angeles residents cannot be sure the city’s confidential or sensitive data will be secure,” said John Simpson, consumer advocate with Consumer Watchdog, “but at least they know there will be a penalty if security is compromised,” he said in a statement e-mailed to “It’s essential that this project be closely watched to ensure that Google keeps its promises.”

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