IBM has won a contract to start consolidating the data center footprint that is serving more than 50 government agencies of New York City. In addition to physical consolidation, the technology company is also tasked with revamping the city's IT infrastructure ÔÇô a project that is expected to save the city up to $100m over five years.

NYC hired IBM for the consolidation project's first phase, the company said Monday. The ultimate goal for the new technology platform, called CITIServ, is to support IT functions of all city agencies. Phase I includes 14 agencies.

One of the goals is to enable service delivery in a cloud-like manner.

IBM general manager Bridget van Kralingen said the company's agreement with New York City is an example of the growing trend among local and federal government IT organizations to turn to data center consolidation and cloud computing to improve service delivery.

"By modernizing technology infrastructure, government organizations are able to speed the deployment of new technologies, reduce energy and operating costs, increase security and better understand their data in order to expedite benefits tracking, root out waste and provide transparency to the public on performance," she said.

IBM is initially targeting help desk, hosting, storage, email, virtualization and network for streamlining under CITIServ.