Public Procurement and FOSS

Alcatraz

I gave an interview to a journalist last week in response to the research that the European Commission's Open Source Observatory publicised in Malaga last week and the corresponding draft procurement guidelines (thanks to Roberto for the pointers to the Malaga news). I was at the conference but a scheduling conflict prevented me attending IDABC's session, which I regret.

Good News

I very much welcome the guidelines; as I have been saying for well over a year now, the first step to encouraging the use of Free/open source software in the public sphere is to facilitate the adoption-led model in addition to the procurement-driven model, at the very least to the extent of encouraging two-phase procurement. As Rishab pointed out (although not with the same words), there are also the issues of substitutability and the freedom to leave, which I believe it's fundamental for a public administration to consider.

Substitutability guarantees citizens access to government without being forced to trade with a single vendor in order to do so, and the freedom to leave ensures public administrations always have the negotiating power to get the best deal for taxpayers. The guidelines begin to address those issues as well - great news.

Concerns

The journalist went on to ask me about all the documented procurement violations. It seems that:

Of a sample of 3615 software tenders that were published between January and August this year, 36 percent request Microsoft software, 20 percent ask for Oracle, 12 percent mention IBM applications, 11 percent request SAP and 10 percent are asking for applications made by Adobe.

That's bad enough, and likely illegal in most cases, but then it also turns out:

According to Gosh, software tenders often have either implicit or explicit bias for software brands or even specific applications. Of a thousand government IT organisations, 33 percent said compatibility with previously acquired software is the most important criterion when selecting new applications. Ghosh: "This implicit vendor-lock in means that a tender, meant to last for only five years, leads to a contractual relation lasting ten, fifteen years or more."

Most concerning of all, however, was that despite this all being completely transparent and public, the Commission is doing nothing about it. They regard the problem as being one that the competitors of the favoured companies should address through the courts. That would be fine if the market was largely functional and there were only rare cases of abuse.

But it's not. The improper procurement activity is endemic, and until that's addressed any competitor attempting to act through the courts is likely to find themselves discriminated against even further. It's never good to sue your customers (as the music industry is finding), and in a market where the customers can specify you out of the running with impunity, it's suicidal. Moreover, it can take years for the courts to make a ruling, which means even more lost opportunity for competing companies - assuming they can survive the wait. Until the European Commission takes adequate corrective actions to address this disease, there is no step in the current software market condition that any competitor is likely to take to address it.

Recourse?

Given the scale of the disadvantage already present, why would any player want to make their position worse? In the report of the interview the Commission representative says: "There are sufficient ways for companies and other organisations to protect their rights." He may be right, but they aren't being used by the FOSS community and the reason is that the abuse is too extensive for anyone to want to make the first move.

I'm delighted by the fact the new procurement guidelines exist, but personally I want to see direct action to establish them - it can't be left up to those already disadvantaged. I wonder if anyone has the stomach for it?

Comments:

Mark Kent has been preaching about 'exit cost' for years.

Posted by Roy Schestowitz on November 03, 2008 at 01:52 AM PST #

Strange I've not run into him - so have I. But this item is not mainly about that - it is mainly about naming brands in tender documents.

Posted by Simon Phipps on November 03, 2008 at 02:08 AM PST #

I believe specially in new EU countries the named vendors ratio in tenders is much higher. MS is mentioned in any s/w related public tender more or less.
And you are right - going to court is a suicide! nobody will do that, its nonsense.

Posted by Evijs Taube on November 03, 2008 at 03:23 PM PST #

Evijs

\*Quebec government sued for buying Microsoft software\*

"Quebec's open-source software association is suing the provincial government,
saying it is giving preferential treatment to Microsoft Corp. by buying the
company's products rather than using free alternatives.

"The lawsuit by Facil was lodged with the Quebec Superior Court on July 15 and
made public on Wednesday. In it, the group says the provincial government has
refused to entertain competing bids from all software providers, opting
instead to supply public-sector departments with products bought from
proprietary vendors such as Microsoft and Oracle Corp."

http://www.cbc.ca/technology/story/2008/08/27/tech-quebec.html

Posted by Roy Schestowitz on November 04, 2008 at 03:46 AM PST #

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