UK government secures public sector discounts on Microsoft cloud products to April 2021

The Crown Commercial Service (CCS) has secured preferential pricing on a mix of Microsoft cloud services for public sector organisations through to 30 April 2021, Computer Weekly has learned.

CCS has signed a memorandum of understanding (MoU) with Microsoft to ensure “eligible” public sector organisations continue to receive discounts on its cloud products, once its current preferential pricing deal with the software giant ends on 30 April 2018.

The Digital Transformation Agreement, as it is called, will run for three years from 1 May 2018 and will feature bespoke, public sector-focused product packages around cloud security and compliance, as well as Office 365 and Windows 10 offerings.

CCS is understood to have held a webinar on Wednesday 28 March 2018 to run public sector organisations through the terms of the new engagement, but – unlike previous occasions – has stopped short of publicising the deal through press releases and blog posts.

When pressed for further information on the arrangement, a CCS spokesperson told Computer Weekly in a statement: “This agreement demonstrates our commitment to ensuring that the UK public sector gets the best deal, and maximum commercial benefit, for government spend on a raft of digital products and services.”

The agreement is the latest in a string of preferential pricing deals Microsoft has struck with the government since 2002.

And, although such an engagement might seem at odds with the government’s pro-SME stance, it benefits both suppliers and users, said Rob Anderson, principal analyst for central government at market watcher GlobalData.

“There has been opposition to these things previously because it can be seen [as the government] preferring one vendor to another, but it is a more pragmatic approach,” he told Computer Weekly.

“Most of the public sector use Microsoft to some degree and it is beneficial to both sides if they can negotiate a central deal for pricing, so Microsoft sales people don’t have to go and negotiate with every single department and government know what they’re going to get.

“And it is not [the government] saying you must buy this, but more a case of them saying: ‘we accept you’re probably going to buy this, so let’s try and get this at the best price we can’,” Anderson added.

It is expected that the products and services featured in the Digital Transformation Agreement cloud products will be made available to public sector organisations through the G-Cloud and the Technology Products 2 procurement frameworks.

Echoing Anderson’s take on the news, John Glover, sales and marketing director at G-Cloud-listed collaboration software provider Kahootz, said that as long as Microsoft’s pricing is transparent and consistent across the whole public sector, SME suppliers have no truck with these types of arrangements.

“As an SME, all we want to do is compete on a level playing field,” he said. “The G-Cloud has helped to increase both competition and opportunities.

“We know that Microsoft is almost impossible to replace in the enterprise, but we have found plenty of opportunities filling the gaps where Sharepoint and others fall short, especially where multiple organisations need to collaborate securely, which is difficult to do with ‘internal’ corporate IT.

“Our successes with the Ministry of Justice and NHS England, which are both big Microsoft houses, prove this,” Glover added. ........................................................................................ .....................................................................................................