Microsoft’s recent partnership with Red Hat may help secure US government contracts

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While Microsoft’s recent partnerships and collaborations with the open sourced community may be signs of the times for the transitioning software company, the move to embrace more open development may also represent a strategic play for expanding its government contracts portfolio.

According to Bloomberg’s Government Analyst Picks, a daily briefing of stories and sources that cover federal markets, Microsoft’s newly formed partnership with Red Hat Inc. could see the use of its Azure Government Cloud increase among federal agencies.

Thanks in part to Red Hat’s already bustling presence in federal use, Microsoft can now leverage its new Azure Certification tie-ins into Red Hat’s Cloud and service provisions. Joining forces with Red Hat now offers governments who prefer either Red Hat or Azure Government Cloud the flexibility of having both services at their disposal.

On July 27, Microsoft announced that its Azure platform has become a Red Hat Certified Cloud and Service Provider. This allows Azure’s public cloud to integrate with Microsoft data centers and a selection of Red Hat products. It also means the government doesn’t have to choose between Microsoft Azure Government and Red Hat products.

Bloomberg Government data shows that Microsoft Azure and Red Hat contract obligations totaled $4.6 and $73.9 million, respectively, in fiscal 2015. There were no overlapping contracts, but this may change as a result of the partnership. Now that government agencies have more flexibility, both companies’ government contract dollars may grow.”

As Microsoft continues to transition and rebrand itself as the cloud-powered productivity company, it also seems to be attempting a retrench in the enterprise, education, and government sectors with the help and use of the open source community. However, instead of seeking to extinguish already existing players, Microsoft seems prepared to offer its services alongside them for the benefit of the customer and longevity of its brand.