The U.S. General Services Administration (GSA) has been on a major push this year to negotiate steep discounts from tech vendors as part of its OneGov procurement strategy, a plan to pool federal agency buying power to drive down prices.
Recently, Google, OpenAI, Anthropic, and others announced similar heavily discounted offerings for U.S. government agencies. OpenAI is offering ChatGPT Enterprise to all federal executive branch employees for just $1 per agency for the next year. Anthropic is offering Claude for Enterprise and Claude for Government to all three branches of the U.S. government (the federal civilian executive, legislative, and judiciary) for just $1.
Meanwhile, Google is offering Gemini for Government for less than $0.50 per government agency for a year and the Google Workspace Enterprise Plus bundle to federal agencies at a temporary price reduction of 71% off the current Multiple Award Schedules Program pricing.
Today, Microsoft announced a similar temporary discount program, joining its peers. Microsoft will provide discounts on Microsoft 365, Copilot, Azure Cloud Services, Dynamics 365, Entra ID Governance, and Microsoft Sentinel and Azure Monitoring. GSA claims that this deal will lead to potential savings of $3.1 billion in the first year.
Satya Nadella, Chairman and CEO of Microsoft, said:
“For more than four decades, Microsoft has partnered with the U.S. Government to serve the American people. With this new agreement with the U.S. General Services Administration, including a no-cost Microsoft 365 Copilot offer, we will help federal agencies use AI and digital technologies to improve citizen services, strengthen security, and save taxpayers more than $3 billion in the first year alone.”
Additionally, Microsoft will make Microsoft 365 Copilot available at no cost for up to 12 months for Microsoft G5 customers. After the first year, this new U.S. Government-exclusive Microsoft 365 + Copilot Suite will be made available with substantial discounts.
Federal agencies that want to take advantage of this offer can opt-in to any or all of these offers through September 2026. If they opt-in, this new discounted pricing will be available for up to 36 months for certain products.
In addition, Microsoft will offer $20 million in additional support services to help government agencies implement the above offers and get the maximum value from these services.
Altogether, Microsoft expects that these discounted services will deliver more than $6 billion in total estimated value over three years for U.S. government agencies.