Last year, the East London council engineered a high-profile competition between Microsoft and open source alternatives (Computer Weekly, 14 October 2003). In an effort to prove its products offered best value, Microsoft provided the council with free consultancy from Cap Gemini Ernst & Young.
"We see potential across the board for open source, but the market is too immature at this stage and the change management and risk costs are too high," said Newham Council's IT director Richard Steel.
"Because we need to do something with our infrastructure now, we have gone with Microsoft."
Microsoft's contract proposals offer benefits for Newham Borough Council and the wider public sector, Steel said.
"Microsoft has changed the way it is approaching the public sector," he said. "It is no longer just selling fragmented products but offering support and other services."
As part of its negotiations with Newham Council, Microsoft has offered support for the Local Authority Software Consortium, which has created its own open source customer relationship management product for the public sector.
The support will include the development of Micro-soft adapters for the software consortium's product portfolio and assistance with the implementation of best practice security and patch management standards.