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Simon Phipps

With a focus on open source and digital rights, Simon is a director of the UK's Open Rights Group and president of the Open Source Initiative. He is also managing director of UK consulting firm Meshed Insights Ltd.

Biased Buyers Blocking Open Source

A recent report shows that 17% of ICT procurement across Europe is biased, with the UK the 4th most common offender.

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The market for public services is very large - almost 20% of Europe's GDP in 2009 - and continues to grow. It's consequently a valuable source of business and provides an economic stimulus to Europe that's far more significant than any individual initiative a government might devise.

It's thus in Europe's interest to ensure that market is as open as possible, so that the effects of the "stimulus package" of public procurement can benefit any qualified player. That's especially the case in ICT, where there's a tendency for legacy US vendors to lock in customers and thus lock out European participants.

How do you do open procurement for ICT solutions? The answer, according to the European Commission, is to ensure that all procurement that requires tendering (and not all does) is specified in terms of the functions required rather than expressing a preference for the brands involved in the solution. That makes huge sense and is likely to create an open, competitive market, with all the cost savings you'd expect.

That's why it's now a legal requirement for public authorities across Europe to procure this way. Directive 2004/18/EC says:

“technical specifications shall not refer to a specific make or source, or a particular process, or to trademarks, patents, types or a specific origin or production with the effect of favouring or eliminating certain undertakings or certain products”.

Of course, that isn't always the most convenient approach for public authorities. It's easier and quicker to bias the procurement in favour of solutions they already know about or have other reasons to prefer. Consequently, despite the clear regulations there seem to be plenty of public authorities across Europe which ignore them.

A recent report (PDF) produced independently by Open Forum Europe (OFE) continues their three-year history of tracking compliance with this directive, and once again they have found a significant percentage of procurements - 17% - which ignore the regulations. That's an increase on their findings from 2010 and 2011.

OFE surveyed 585 invitations to tender by contracting authorities across Europe during the second quarter this year. They found that nearly one in five of the tenders analysed included technical specifications with explicit references to trademarks. Of those tenders, the most commonly-referenced trademarks were those of Microsoft and Oracle, comprising nearly 50% of the tenders apparently breaking the rules.

The most frequently offending sources of these tenders were Poland, Germany and France, with the UK equal 4th in the list of offenders. (When normalised against the overall number of tenders, the UK falls to 9th place, behind a group of recently admitted or recently turbulent economies).

As OFE notes, this is a worrying trend generally, and given they are only able to survey formal tenders implies there is a much bigger problem with biased procurement happening below the tendering threshold. While it impacts all ICT suppliers, it is of special concern to open source, where a preference for proprietary incumbents acts as a barrier to any opportunity to gain government business. The EU has plenty of big ideas about open procurement and especially about enabling procurement of open source solutions; the experience on the grounf doesn't seem to be getting better.

If we are to see "government procurement stimulus" truly benefiting Europe, this is a serious problem that still needs addressing. If the UK government is as serious about open source as it claims to be, I'll expect to see action. Over to you Mr Maude.

[Disclosure: I am an honorary Fellow in the independent Open Forum Academy programme sponsored by OFE. I am not compensated for this role.]

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