Microsoft offers major discounts to government customers in latest ‘OneGov’ deal
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By
Frank Konkel
The discounts could be worth as much as $3.1 billion in year one, according to the General Services Administration.
The General Services Administration announced a OneGov agreement with Microsoft Tuesday that will see the tech giant provide major discounts across its cloud services suites and cybersecurity tools, including Microsoft 365, Copilot, Azure Cloud Services and Dynamics 365, Microsoft Sentinel and more.
Through the agreement, Microsoft will also make its Microsoft 365 Copilot available at no cost to G5 customers that require advanced security environments.
“GSA is proud to partner with technology companies, like Microsoft, to advance AI adoption across the Federal government, a key priority of the Trump Administration,” said GSA Deputy Administrator Stephen Ehikian. “We urge our federal partners to leverage these agreements, providing government workers with transformative AI tools that streamline operations, cut costs, and enhance results.”
Additional discounted tools include Microsoft Sentinel and Azure Monitoring; Extra ID Governance; and Dynamics 365 at no cost for up to one year for eligible workloads and implementation, adoption and optimization workshops.
“Federal agencies can opt in to any or all of these offers through September 2026 with discounted pricing available for up to 36 months for certain products,” according to GSA.
The new agreement is an extension of GSA’s Government Microsoft Acquisition Strategy agreement announced in January and follows the release of President Donald Trump’s AI Action Plan in late July. Many of Microsoft’s discounted tools, including Office 365 and the Copilot suite, enable agencies to take advantage of AI.
“For more than four decades, Microsoft has partnered with the U.S. Government to serve the American people,” said Satya Nadella, Microsoft’s Chairman and CEO. “With this new agreement with the U.S. General Services Administration, we will help federal agencies use AI and digital technologies to transform government operations, improve citizen services, strengthen security, and save taxpayers more than $3 billion in the first year alone.”
In a blog post, Chris Barry, Microsoft Corporate Vice President for US Public Sector Industries, added: “This expansive offering will help agencies achieve key pillars of the America’s AI Action Plan by enabling federal agencies to serve at the forefront on driving AI innovation and adoption in service to the American people. Through this agreement federal agencies will access the latest AI capabilities at scale, now integrated in many of the products they already use, to achieve key administration priorities.”
Microsoft is the latest major tech company to strike a deal with GSA through its OneGov strategy, which essentially treats government customers as a single large purchaser. Microsoft follows Google Public Sector, Adobe, Salesforce, Elastic, Oracle, Uber, IBM, Docusign, Amazon Web Services, OpenAI, Anthropic and Box in securing OneGov agreements.
Last month, GSA also announced the launch of USAi.Gov to serve as a centralized, secure generative AI evaluation suite for federal agencies to explore AI services. All these efforts are geared around supercharging how federal agencies, including the Defense Department, use AI.
“GSA is accelerating access to AI for federal agencies and delivering on the President's AI Action Plan,” said Federal Acquisition Service Commissioner Josh Gruenbaum. “OneGov represents a paradigm shift in federal procurement that is leading to immense cost savings, achieved by leveraging the purchasing power of the entire federal government. We appreciate Microsoft's partnership in this modernization and its commitment toward an interoperable digital federal ecosystem.”