Skip to main content

UW waives indirect cost on cloud services

logosThe University of Washington has waived indirect cost on cloud services.

This decision removes one of several bizarre disincentives to the rational selection of research computing and storage options – disincentives that plague universities nationwide.

Federal guidelines waive indirect cost on purchased equipment – so purchasing a $100K cluster costs a grant budget $100K, despite the fact that this equipment must be housed, powered, cooled, backed up, replaced …

Meanwhile, indirect cost is charged on outsourced cloud services – so purchasing $100K of AWS or Azure services costs $157K (at UW’s rates – different institutions have different markups), despite the fact that the only actual overhead is paying an invoice.

UW IT and the UW Office of Research have now decided to unilaterally waive this nonsensical charge.

Progress! Hopefully others will follow!

Read more here.

Three footnotes:

  1. There is precedent for national action: several years ago it was ruled, nationally, that indirect cost should not be charged on outsourced gene sequencing services.
  2. There are additional bizarre disincentives to the rational selection of research computing and storage options. If you want to purchase a large cluster, your NSF program officer will send you to the Major Research Instrumentation program, which is not charged against any specific Program, Division or Directorate – so it’s “free” to his/her program … what could be finer? And once the cluster arrives at your university, Santa Claus pays for the power, Mrs. Santa Claus pays for the cooling, Rudolf shares his space, and the Elves do the backup … all of these, which have very real costs, appear free to the investigator at most universities.
  3. Finally, it goes without saying that cloud services are not the right choice for every application. What UW’s decision does is simply to take one step towards leveling the playing field, leading to rational choice.