Vivek Kundra, White House CIO, has just published a 25 point plan to reform federal IT spending, to deliver better Business Value to the American public for their $80 billion a year spending.

What is exciting to our Cloud Ventures point of view is the shift to a “Cloud first” procurement policy. Kundra wants to transform IT projects from slow and monolithic to fast and modular, achieved by utilizing the Cloud, and this will drive a wave of new Cloud industry innovation and growth.

He explains the heart of Cloud computing by clarifying the primary business benefit of the technology, illustrated through describing the difference between a commercial business utilizing the Cloud, a movie-sharing start-up using it for their web site, versus the ‘Car Allowance and Rebate System’ government project, otherwise known as ‘Cash for Clunkers’. In contrast they opted for the ‘traditional’ in-house data-centre approach.

Both experienced a “flash mob” level of traffic, but where the Cloud-based site was able to fluidly adapt, scaling from 50 to 4,000 virtual machines in 3 days, the Cash for Clunkers project was unable to cope, having numerous outages and service disruptions. Being locked into this inflexible system meant it took over a month to finally stabilize the project.

Kundra wants the US Government to avoid this for all future projects, making a wholesale shift to the new, advanced level of IT capability, and has outlined a 25-point strategy for achieving this.