[Talk] MEDIA RELEASE: Open Source Victoria says $150, 000, 000 to be saved by Increased Competition in Government Software Procurement Policy

Con Zymaris conz at cyber.com.au
Fri Feb 13 11:38:26 EST 2004


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Open Source Victoria says $150,000,000 to be saved by Increased
Competition in Government Software Procurement Policy
Melbourne -- 13 February 2004

The Open Source Victoria (OSV) industry cluster believes that there is
not enough competition for the procurement of infrastructure and desktop
productivity software in the government and public sectors in Australia.
We welcome and encourage all federal, state and local governments
actions which helps to redress this problem. We note that there has been
increasing interest and attention from government procurement and policy
staff towards seeking alternatives to existing entrenched platforms and
software. Failure to do so will result in government agencies being
caught in an a vendor lock-in scenario which will be extremely costly to

Specifically, there is a growing volume of system and application
software which have become commoditised in recent years: file, print and
email servers, DNS, web, proxy and other edge-of-network servers,
firewalls, smaller database and application servers, desktop operating
systems and desktop productivity suites are all now available in quality
open source implementations, that support a broad range of operting
systems and carry no licence costs. OSV strongly recommends that
governments begin the process of preparing migration plans to these
platforms over the coming years. This will be the best way of increasing
competition in this space and ensuring competitive prices from all
software vendors in future.

"To give an indication of just what kind of money can be saved,
Microsoft has recently released a statement where they claim to receive
around $175 million per year from the Australian government and public
sector" offered OSV member, Rodd Clarkson. "Most of this money will be
in the form of software which is predominantly for server and desktop
systems and application software, just the type which can be replaced
through commodity open source equivalents."

"Whilst governments cannot avoid purchasing hardware and they must also
hire IT staff to build and run systems, there's no reason nowdays for
ploughing hundreds of millions of taxpayer dollars into easily avoided
costs," added fellow OSV member Adam Crow.

In order to kick-start this increase in competition, it may be necessary
to take a leaf from other areas of government procurement practice. 
Australian governments already have it within their power to exclude
specific providers from procurement bids, if they deem those providers
are endangering the competitive landscape through a monopolistic
postition. Exactly such a scenario has recently been enacted by the
Tasmanian government.

"In Tasmania, the governemnt elected to exclude Telstra from a
wide-ranging tender which seeks to develop improved broadband links to
the mainland," said Clarkson. "The government realised that in a market
dominated by Telstra, this kind of action is the only way to break the
vicious circle which keeps other competitors out of the market." 

"We want governemnts to consider this procurement option in the software
space. Specifically, by excluding Microsoft from just a single
software-platform refresh cycle in those areas where Linux and open
source software are a good fit for government," added Crow. "This is
what's needed to grow competition in the marketplace in the future. If
state governments can do this for broadband, they can do this for
software, too."

OSV recommends that the following actions be taken by government
agencies to increase the level of competition in the public-sector
software market:

1) Governments should determine the quantity of software purchased from
   proprietary vendors which could be replaced by commodity open source
   equivalents like Linux, OpenOffice.org, Sendmail and Apache where it
   makes sense.

2) Governments exclude Microsoft from just a single round of 
   desktop, server and infrastructure software tenders, to help
   reduce that supplier's monopoly position within the market.

3) Governments look to specifying the use of open standards and
   protocols that promote competition amongst vendors in future tenders,
   rather than limiting choice.

"As local businesses, we are concerned that monopoly vendors have been
taking advantage of the government's inertia, to lock them into
expensive and suboptimal solutions," Clarkson said. "We offer our
organisation's skills and knowledge in reducing vendor lock-in
situations, thus achieving the greatest competitive environment
possible, benefiting all Australian governments."

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About Open Source Victoria

Open Source Victoria is an Industry Cluster consisting of over 100
Victorian firms and developers which provide services and technology
related to Free and Open Source Software (FOSS.) Open Source Victoria
offers marketing, advocacy and information referral services, and aims
to raise the profile of FOSS in Victoria and work with other similar
organisations across Australia.


Contact: Con Zymaris
Phone: 03 9621 2377
Fax: 03 9621 2477
Email: conz at cyber.com.au
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Con Zymaris <conz at cyber.com.au> Level 4, 10 Queen St, Melbourne, Australia 
Cybersource: Australia's Leading Linux and Open Source Solutions Company 
Web: http://www.cyber.com.au/  Phone: 03 9621 2377   Fax: 03 9621 2477

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