A small but growing group of European governments - including Finland and France - are throwing their support behind open standards.
Under the deal, signed by German interior minister Otto Schily and Erwin Staudt, chairman of IBM Deutschland, federal, state and local governments will receive discounts on IBM hardware and software products that support Linux.
IBM plans to preinstall on its servers a version of Linux, supplied by SuSE Linux. SuSE Linux is a member of the new UnitedLinux group that aims to create a common business version of the operating system. The other members are Caldera, Turbolinux and Conectiva.
The German government hopes to save money and improve security by jumping on the Linux bandwagon.
In a written statement, Schily said that the partnership with IBM stems from talks about new IT security measures following the 11 September terrorist attacks in the US. He said that by supporting open-source software, the German government would avoid a "mono" IT environment, which is more susceptible to attack.
Schily added that support of Linux would enable the public sector to achieve a greater level of software "heterogeneity" and to procure products for open-source environments more "quickly and easily".
IBM will also provide technical support to government departments deploying Linux and other open-source software products. This will include the launch of an open-source portal and a hotline service.
The company will also be in charge of establishing a strategic management team to help develop new IT solutions based on open standards for the public sector
The German deal will extend to December 2004.