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Microsoft gives U.S. government a free year of services

Microsoft's deal with the U.S. General Services Administration includes $20 million in support services and aims to save taxpayers $3.1 billion in the first year through cloud and AI service discounts.

  • On Tuesday, the GSA announced a deal with Microsoft Corporation projected to deliver more than $6 billion in value over three years, including a one-year no-cost Microsoft 365 Copilot licence for eligible G5 plan users.
  • GSA's OneGov initiative centralises federal purchasing to lower prices, with Josh Gruenbaum, Federal Acquisition Service Commissioner, urging agencies to leverage it to accelerate AI adoption.
  • Discounted pricing covers Microsoft 365, Azure cloud services, Dynamics 365 and Microsoft Sentinel, Microsoft holds FedRAMP High authorizations and Department of Defense provisionally approved Copilot with full FedRAMP High expected soon, plus Microsoft's $20 million support commitment for agency training.
  • The deal could save taxpayers $3.1 billion in its first year, with federal agencies required to buy through the U.S. General Services Administration and opt in through next year; Nicholas Chaillan warned, `Pricing this low is not about serving agencies  it's about forcing dependence on a single vendor, hiding future costs, and squeezing out fair competition`.
  • Other big-tech deals show OpenAI and Anthropic offered one-year access for $1, Google priced Gemini for Government at $0.47, while most OneGov contracts expire in 2026 and AWS extends to 2028, leaving pricing uncertain.
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UPI broke the news in Washington, United States on Tuesday, September 2, 2025.
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