Microsoft To Lose British Battle In Open Source War

Microsoft could lose more than $800 million dollars a year in the British market if the country's government sticks to plans to use more open source software. New guidelines say public services should avoid being locked into proprietary products.

The changes don't mean Windows will be ditched overnight (as is happening in Vietnam), but instead policy will be that open source software should be used wherever it presents a better value. This could include both Linux-based operating systems and open source applications such as the Microsoft Office-like Open Office. Larger organizations may also have to consider open source options for the servers behind their databases.

The plans include a couple of specific guidelines which could hurt Microsoft even more. Government departments and agencies planning to buy proprietary products such as those used by Microsoft will now have to make sure they offer the same degree of flexibility as open source alternatives.

And while government buyers must take into account the maintenance costs of software and the costs of training staff to use it, wherever "there is no significant overall cost difference between open and non-open source products," they should choose the open source option.

850 Million USD Annual Savings

The BBC quotes open source advocates as saying the moves could save the government 600 million pounds sterling (GBP) a year, currently calculating at just over $850 million USD. While that includes some spending on other commercial products, the bulk of that money would be disappearing from Microsoft's revenues. (Source: bbc.co.uk)

Microsoft is unlikely to find much political support in opposing the policies. The main opposition party in the UK is already on the record as supporting greater use of open source technology.

Price Cuts In Store

Simon Phipps, the head of open source for Sun (producers of Java), predicts firms such as Microsoft will respond by cutting prices or rewriting contracts so that the bulk of the payments comes later on, making the deal look better now for organizations which work to annual budgets.

However, there is one final note of relief for Microsoft and its commercial rivals: the plans don't have any fixed timetable, meaning it could be some time before the policy change leads to a change in practice. (Source: arstechnica.com)