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Health secretary Alan Milburn said last week that the licensing deal cost the NHS £50m, but would also save that amount by removing the need for local small-scale purchasing of Microsoft software in the health service.
However, BMA IT committee chairman Grant Kelly said a lack of alternatives to Microsoft desktop operating systems and office tools will mean that the NHS will be in a weak position when it comes to renegotiating the contract in three years' time.
"The NHS is not very good at understanding business contracting and this has been proven in its IT procurement," he said.
"If this was a realistic competition, with say 50% Microsoft and 50% Novell then it would make good sense but at least 80% of the NHS uses Microsoft so in three years Microsoft will have the NHS over a barrel.
"I am surprised it has got past European procurement laws," Kelly added.