Nov 29 2016

Will the MEGABYTE Act Make Waves in Federal Software Procurement?

The White House’s latest software requirements could generate significant savings, but the jury is out on whether federal CIOs will stand behind the bill.

Federal CIOs need an action plan for tackling software management.

The Making Electronic Government Accountable by Yielding Tangible Efficiencies (MEGABYTE) Act, signed into law July 29, requires agencies to develop comprehensive software licensing policies and work toward a more unified approach to software acquisition.

MEGABYTE comes at the end of a long line of legislation on the topic. The 2014 Federal Information Technology Acquisition Reform Act, for instance, aimed to empower agency CIOs to reduce wasteful technology spending.

According to a 2015 MeriTalk study, FITARA earned an 84 percent approval rating among federal IT executives. The reaction to MEGABYTE has been “somewhat subdued” by comparison, says Katell Thielemann, a Gartner research director who specializes in the U.S. federal government market.

"We haven't seen all of the excitement around the policy,” she says.

Making Sense of the MEGABYTE Act

Thielemann attributes the response to the fact that many agencies are still grappling with FITARA mandates, but she says the presidential election cycle may be having an impact as well.

"An administration is about to change over, and you're going to have a slew of new leaders come in,” she says. “It's possible that there is some slack being entered into the process just to allow for these things to mature at their own pace.”

Despite the largely muted reaction to the new bill, Maria Roat, CIO of the Small Business Administration (SBA), believes MEGABYTE will positively affect agencies.

"It's a long time coming," she says about the bill, which requires federal agencies to inventory 80 percent of their software license spending and enterprise licenses.

Roat and her team got a jump-start on the inventorying process in December 2015, after the Office of Management and Budget released draft guidelines on how federal agencies should buy and manage software licenses.

When introducing those guidelines, OMB noted that the U.S. government spends more than $9 billion on software licenses each year, but industry experts claim that a large portion of that spending is wasted.

“There is an opportunity to take a significant amount of cost out of the equation and redeploy those dollars for something else,” said Jim Ryan, CEO of Flexera Software, in an interview with FedTech.

According to Thielemann, the OMB’s guidelines attempt to generate savings by increasing transparency around software agreements, giving procurement professionals the ability to compare what they’re paying across the board.

Creating an Inventory of Software Assets

MEGABYTE, on the other hand, mandates that agencies employ automated network discovery and asset management tools to make cataloguing assets as thorough and painless as possible.

Ryan told FedTech that the stricter inventorying requirement will help CIOs and agency procurement experts make more informed purchasing decisions.

Roat agrees that it’s a push in the right direction: “I think having it in a MEGABYTE act really gives CIOs what they need to make the change and make it happen,” she says.

Roat saw that change firsthand after the SBA deployed an automated software management solution last December. She believes there’s a deeper purpose behind the bill.

“It's not just about a software inventory,” she says. “It's really looking at the broader picture of where we're going as an enterprise and what tools we need.”


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