On October 27, the Los Angeles City Council tentatively approved a $7.25 million contract to replace the City’s current email system with Google’s “software as a service” product. The move makes L.A. the largest city in the U.S. to transfer its e-mail over to the Internet giant’s “cloud computing”-based service. Once terms of the contract are finalized, Falls Church, VA-based Computer Sciences Corporation, Inc. will replace the city’s current system with Google Apps, the latter of which will run remotely on Google’s servers rather than users’ desktop computers. Some say cloud-based technology, which refers to being able to access a variety of IT services via the Internet, is relatively new and may not provide enough security for the city’s law enforcement and other government systems. But others claim it’s secure and economical because the city does not have to install costly servers and other hardware. A little mentioned fact of the deal, however, is North Hollywood-based SADA Systems, Inc. was involved in convincing L.A. to go with cloud computing, according to the company’s CEO, Tony Safoian. And, SADA landed a slice of the contract. “We were involved in the early stages of Los Angeles exploring cloud computing,” said Safoian. “We provided demos and helped the city vet out its ability to use it.” About a year ago, SADA, an information technology services firm founded in 2000, teamed with Google to educate the City on about the technology. The City eventually sent out a request for proposals to update its e-mail system, according to Safoian, and Google responded. The Council chose Google’s offer over competing bids from Microsoft and multiple other technology firms. And the move will effectively end the city’s contract to use Novell Inc.’s GroupWise e-mail and record-keeping software. Under the deal, the Google system will provide e-mail, word processing, spreadsheet, and presentation applications to the City’s 30,000 employees. However the City is also asking for the new service provider to pay a penalty if security is breached on the system. “The City seemed to be serious about cloud computing,” said Safoian. “And if you think about state and local governments…everybody will be tracking this. It’s a different way of thinking about IT.” Once the contract is finalized, SADA will help with some of the technical integration, said Safoian. And the firm will train administration, and the people who will train city employees, on how to use Google Apps. Other Valley-based IT professionals view L.A.’s decision to use cloud computing as a positive for the industry. “I think it’s validation that large institutions can benefit from the cloud,” said Mike Eaton, CEO of the Thousand Oaks-based IT services company, Cloudworks. “The three benefits of cloud computing are reliability, performance, and cost effectiveness because there’s little up-front capital involved in using it.” Over the past 18 months there has been a lot of talk and press about cloud computing, he said, and now all of the talk is turning into companies and governments making concrete decisions to use the technology. Over the past four months Cloudworks has experienced an increase in prospective clients, he added. “It’s the logical next step,” said Eaton.