Public sector grabs cheaper MS deals

Businesses are being left out in the cold while Microsoft cuts huge licensing deals with the public sector, say angry users.

Recently Computing exclusively revealed that local government, Whitehall departments and the police are negotiating agreements similar to the one Microsoft has already signed with the NHS.

Meanwhile, many private sector businesses are still campaigning against licence changes, which blue chip user group The Infrastructure Forum claims will lead to an average 94 per cent increase in costs.

David Rippon, chairman of user group Elite, says Microsoft seems to be pursuing two separate strategies.

"It's a classic situation where a supplier is picking off the obvious big customers," he said.

"What it will leave out is customers at the high end of small and medium-sized business. Microsoft won't cut a deal for a company with 500 seats.

"I suspect the big customers will get the cut-price deals and we will be thrown to the sharks," he said.

Earlier this month the NHS signed a three-year corporate licence for all Microsoft software that it says will save £50m [Computing, 18 October].

Microsoft has provided the Office of Government Commerce, local government user group Socitm and the Association of Chief Police Officers with a discussion document for a UK Government Microsoft Licensing Agreement.

Socitm is asking for feedback from its members, and is urging them to provide details of their licensing costs.

Analyst Meta Group says that while large companies will still be able to negotiate with Microsoft, the best option for smaller companies is to audit their number of Microsoft licences.

Microsoft claims its licence changes will only affect a small number of customers.