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Romania Issues €100 Million To Microsoft Without Bids

Peter Judge has been involved with tech B2B publishing in the UK for many years, working at Ziff-Davis, ZDNet, IDG and Reed. His main interests are networking security, mobility and cloud

Contracts are drafted to exclude any alternatives and hand the money over to Redmond, say local activists

The Romanian government is spending hundreds of million euros on proprietary software from Microsoft, without opening up the bid to competitive tenders or considering alternatives, according to complaints from the country’s open source community.

The government has announced it will pay €300 million (£262 million) to a Romanian IT company for PCs and Microsoft software licences for use in education (see Google translation), while also directly paying Microsoft €100 million (£87 million)  for software licences to be used in government agencies between 2010 and 2012 (see Google translation). The country is also paying €58 million (£50 million)  this autumn for its existing 2004 to 2009 framework agreement.

The problem of contracts that are not tendered properly is rampant across Europe, and wastes public funds that could be better spent elsewhere, says  Georg Greve, president of the Free Software Foundation Europe (FSFE). The Swiss government issuing a contract to Microsoft for £8 million a year, without a tender), and cases may be more extreme in Eastern Europe, he said.

“This decision of the Romanian government seems careless and endangers the country’s sustainable economic growth by increasing its dependency on proprietary software and by wasting funds that would have been better used elsewhere, for instance on infrastructure,” said Greve.

“The €100m licensing fee payment was not tendered, from what I could see,” said Greve. “The 300m EUR education budget was tendered, but the tender was drafted so that only one company (a Microsoft Gold Partner) might possibly make an offer by means of limiting the tender to companies that can show they have a pre-existing support network in Romania that services at least 45,000 users. Only that particular company did – as I am sure the authors of the tender were well aware.”

Often the details of such large contracts are declared “state secrets” and cannot be examined, but a corrupt deal was exposed in Bulgaria in 2007, in which the government paid above street prices – so it could have bought the licenses cheaper by going to any computer store in Sofia. The official report is here, and a partial translation here.

The announcement came just before the opening of Romania’s open source conference, eLiberatica, in Bucharest. “The Romanian government is out of touch with reality,” said conference organiser Lucian Savluc. “I hope that the European Union will protest this deal, for it is not in the best interest of the Romanian citizens.”