Microsoft Orders UK's National Health Service To Pay Overdue Licensing Fees; NHS Presses 'Remind Me Later' Button In Response

from the ...and-sets-internal-clock-back-to-1901 dept

How adorable! The government thinks it's people!

The UK's National Health Service is apparently doing what we all do when software starts asking to apply updates or renew licenses: it's hitting the snooze button. But all that snooze tapping has apparently awoken the slumbering giant (to abuse many metaphors…). Microsoft is now demanding the NHS perform a speedy but thorough compliance check and forward all owed licensing fees to the software giant posthaste.

The tough talking comes more than a year after an organisational shift began across the NHS (April '13) saw some Primary Care Trusts and strategic health authorities abolished and clinical commissioning groups taking their place.

The company this month wrote to NHS organisations saying the overhaul made "this latest review and subsequent re-allocation necessary". It told the bodies to assess their software estate and cough for any "identified shortfall" by 30 June.
The June 30th deadline is directly related to the end of Microsoft's fiscal year. It would definitely like to see a bunch of licensing fees applied to the bottom line before it wraps up the year. Of course, this same desperation to put anything it can in the sales column for FY13 also works against its gruffly-delivered demands.

The NHS already takes advantage of the steep discounts Microsoft offers to public sector entities, which gives it a 28% discount compared to private sector prices. On top of that, more discounts may apply if Microsoft feels it can make it up in volume. Add to that the fact that the company has previously struck some pretty sweet last-minute details in late June just to rack up a few more sales for the ending fiscal year, and the NHS has absolutely no compelling reason to get right on that compliance audit.
Channel partners told us that Microsoft had talked tough with the public sector before but said this was a risky strategy, and one claimed "when the rubber meets the road Microsoft will back down"...

"Microsoft talks tough but at the last minute when it needs a deal it capitulates. Microsoft is the victim of its own commissions plans and quarterly targets. Smart buyers manipulate the situation, those that can wait for deals in June," he added.
Microsoft realizes this too, and added stronger-than-usual language to its pay-up-or-else threat, implying that existing discounts will be removed if the NHS doesn't stop acting so disinterested in paying license fees.
This is your decision but given your high risk status without action you will be asked to undertake a software licensing review. This review will start in July and if further non-compliance is identified, and commitment is not given to resolve it, you may be liable for the full amount under the commercial select level A pricing and may be subject to further compliance action".
To which the response has been a resounding "whatever." Even Microsoft knows its threats don't amount to much. Wherever this year's portion of the £500m contract (over nine years) lands, it will make an impact.
Any failure by an NHS body to hit the deadline this month will equally be a welcome boost to Microsoft's Q1 sales ledger for the next financial year.
As is the case almost every time you let a subscription lapse, the entity on the other hand will cut you a deal just to get you back on the ledger. And like everyone else everywhere, the government -- even with all its [well, not really its] money and power -- is no different. Microsoft delivers bold pronouncements and dire warnings and the NHS hits the "remind me later" button and goes back to what it was doing.

Sure, we'd all like to think that our government agencies are composed of better, sterner stuff, paying all their dues on time and never, ever throwing "YOUR SUBSCRIPTION IS EXPIRING!" notices directly into the trash, but underneath it all, every government agency is made up of people no better (and sometimes, much worse) than your or I.


Reader Comments (rss)

(Flattened / Threaded)

  1.  
    icon
    Spaceman Spiff (profile), Jul 3rd, 2014 @ 7:28pm

    What the NHS really said to MS

    Just go suck some eggs! Take two aspirin, and call us at the end of the year... :-)

     

    reply to this | link to this | view in thread ]

  2.  
    identicon
    Anonymous Coward, Jul 4th, 2014 @ 12:15am

    What does NHS use that can't currently be done with floss?

     

    reply to this | link to this | view in thread ]

  3.  
    icon
    Retsibsi (profile), Jul 4th, 2014 @ 1:55am

    Could this by any chance be linked to recent comments by the government about having smaller suppliers included in the next round of government contracts (since contracting with major suppliers has proven such a resounding success in the past)?

     

    reply to this | link to this | view in thread ]

  4.  
    identicon
    Anonymous Coward, Jul 4th, 2014 @ 2:14am

    Re:

    There is a fair amount of bespoke software written for windows and a lot of big machines that rely of windows.

    I guess though the NHS could use that £500m and make the switch fairly easily but I guess they don't want too.

     

    reply to this | link to this | view in thread ]

  5.  
    icon
    Ninja (profile), Jul 4th, 2014 @ 3:48am

    Lucky them this financial "remind me later" button doesn't pop up in the background with a timer that reboots the goddamn computer whether you want or not. I remember at least 2 occasions where this fcked up my gaming, one at a WoW raid and the other, less catastrophic, during a Skyrim play. Trust me, things simply start closing while you look in despair.

    Imagine if it happened in real life?

     

    reply to this | link to this | view in thread ]

  6.  
    identicon
    Anonymous Coward, Jul 4th, 2014 @ 4:20am

    The NHS shouldn't be funding Microsoft anyway. It disgusts me that they do.

    Move to Linux platform. Contribute to open source and create new software where needed. It would probably be cheaper and a lot of the work for everyday computing is already done.

     

    reply to this | link to this | view in thread ]

  7.  
    identicon
    Anonymous Coward, Jul 4th, 2014 @ 5:40am

    Fallacy

    It's fairly routine for Microsoft to give multinational customers 30%+ discounts, usually because that's a typical uplift over US$ prices in the USA or in Asia.

     

    reply to this | link to this | view in thread ]

  8.  
    icon
    Spaceman Spiff (profile), Jul 4th, 2014 @ 6:55am

    Difficult

    For an organization the size of the NHS, switch even partially to Linux is a huge undertaking which would likely take several years, even if intelligently staged. At the least though, they should start creating WindowsLinux bridge servers (OpenLDAP, email, etc), supporting alternative user applications (Open/Libre Office, etc) and start migrating users to Linux. Once they get to some sort of "break even point", they can start retasking their Windows systems in bulk. Big costs in training though as by that point the remaining Windows users will be dragging their heels to change how they have worked for years...

     

    reply to this | link to this | view in thread ]

  9.  
    identicon
    Anonymous Coward, Jul 4th, 2014 @ 8:58am

    Re: Difficult

    A lot of the tasks required by most staff are not MS specific and don't require retraining to a large degree. Probably libreoffice is the only real thing they need to "retrain" for and they could lose the majority of windows machines.

    The numbers of computers would be staggering. Even if the NHS only had one computer per 1000 people, there would be about 64,000 PCs. When you add doctors surgeries, care homes, home help and factor that all paperwork and regular administration is also done with computers etc... I wouldn't be surprised if it were over 10 PCs per 1000 people.


    DAMN... they spend £50 million on Microsoft Office per year.
    http://www.theguardian.com/technology/2014/jan/29/uk-government-plans-switch-to-open-source-fro m-microsoft-office-suite

    At least they are moving to open source.

     

    reply to this | link to this | view in thread ]

  10.  
    icon
    madasahatter (profile), Jul 4th, 2014 @ 10:00am

    Re: Re:

    MS' strategy has the potential of backfiring because there is enough IT talent available in most countries to rewrite the derived applications for another base application or OS.

    Munich apparently got fed up with the money grubbing antics of MS and the cities lack of overall control that they went completely FOSS. Munich has their own city developed Linux distro - LiMux (I believe it is an Ubuntu derivative).

     

    reply to this | link to this | view in thread ]

  11.  
    identicon
    observer, Jul 4th, 2014 @ 10:15am

    Re:

    How much money must the government (not just the NHS, but government and public services in general) be wasting on licensing fees for software that has open-source alternatives? It doesn't bear thinking about.

     

    reply to this | link to this | view in thread ]

  12.  
    identicon
    jrom, Jul 4th, 2014 @ 12:56pm

    Sorry Linux fans, but no.

    >I've always wondered why the public sector is still using Microsoft stuff, and not .

    Ask anyone that actually works in the IT industry.


    >It's free!

    Free to install onto a desktop. There are at least a dozen stages after this, most of which will cost more than using MS stuff. Then there's support. Integration. It's a mammoth (and ultimately, non-money-saving) task.


    >It shouldn't be that complex

    It is actually quite horribly complex. There are many, many factors you don't have to consider when dealing with just one machine.


    >especially when they can't afford the alternative.

    Using MS is actually cheaper if you buy all-in-one CAL's that allow connections to SQL, Exchange etc. Of course, nobody in the open source brigade wants to hear this, but the costing exercise has been done for Councils, hospitals etc. many, many times. Cloud-based desktop solutions currently cost 2 -3 times per-user what a desktop/ thin-client/ local offering would for big sites, so they're not really an option yet either.

    I'm not arguing an opinion - this is the reality. Easily verifiable from anyone actually doing it for sites of any real size. Sorry to burst anyone's bubble - go look at the IT contracting sites for how many desktop-linux support jobs there are.... And how much they cost.

     

    reply to this | link to this | view in thread ]

  13.  
    icon
    Coyne Tibbets (profile), Jul 4th, 2014 @ 1:53pm

    Just wait until the NHS starts getting the "Windows not genuine" dialog. They'll pay then.

     

    reply to this | link to this | view in thread ]

  14.  
    identicon
    Anonymous Anonymous Coward, Jul 4th, 2014 @ 3:42pm

    Re: Sorry Linux fans, but no.

    Sounds like an opportunity to resolve a bunch of those issues you mention. Would the cost be much higher than staying with M$ over say a 5 year changeover plan, heavy on the desktop early and the hard stuff (many fewer machines) toward the end of that 5 years?

    Typically a large organization will buy a lot of one type of machine. Once your Linux guru's have a working setup, they can image that, and roll it out. Sure there will be outliers, but maybe buying Linux ready equipment to replace those will ease the process (and put pressure on hardware vendors for compliance).

     

    reply to this | link to this | view in thread ]

  15.  
    icon
    bongleblue (profile), Jul 4th, 2014 @ 4:08pm

    Microsoft

    As if Microsoft doesn't already make enough money and Windows OS is a piece of junk. I prefer Linux OS.

     

    reply to this | link to this | view in thread ]

  16.  
    identicon
    Anonymous Coward, Jul 4th, 2014 @ 4:23pm

    Re:

    +1 funny

     

    reply to this | link to this | view in thread ]

  17.  
    icon
    SciFiMack (profile), Jul 5th, 2014 @ 3:04pm

    Vendor Lock In

    Microsoft have strategically moved key software use rights from a perpetual software license into maintenance. Many NHS Trusts will need to update software licenses with active maintenance if only to support virtual desktop programmes, mobile working or virtual server environments, this is often unconnected to whether they will deploy the latest version.

    When the Government exited the national EA, they were effectively making every trust in the UK non-compliant. Any Trusts that do "buy back in" to support compliance or to plan for end of extended support will be locking themselves into an ongoing subscription relationship with a audit clause.

     

    reply to this | link to this | view in thread ]

  18.  
    icon
    Richard (profile), Jul 6th, 2014 @ 6:44am

    Re:

    Then the Daily Mail will run a "Microsoft is holding the NHS to ransom" story and Microsoft wil have to back down.

     

    reply to this | link to this | view in thread ]

  19.  
    icon
    Niall (profile), Jul 7th, 2014 @ 2:11am

    Re: Re: Difficult

    As someone who works in NHS IT it's much closer to 1 PC per 10 people than 1 per 100. Obviously you have a lot of manual, cleaning and catering staff who never go near a computer, and a lot of nursing staff who may share a few - but otherwise you will often have consulting rooms and surgeries with one or more PCs, often to allow for ad hoc consultations or hot desking.

    Certainly in my own immediate (clinical) area, we have about 1 PC per two members of staff on average (although that isn't including ancillary support staff who aren't directly beholden to us and may work across multiple departments).

     

    reply to this | link to this | view in thread ]

  20.  
    icon
    Niall (profile), Jul 7th, 2014 @ 2:12am

    Re:

    We get those even with long-ago-paid-for licences! Funny how they appear just after MS has 'pulled' support for older OSes...

     

    reply to this | link to this | view in thread ]

  21.  
    icon
    John Fenderson (profile), Jul 8th, 2014 @ 12:20pm

    Re: Sorry Linux fans, but no.

    "I'm not arguing an opinion - this is the reality"

    But a special case reality. The reason for the costs you cite are because these efforts are trying to integrate Microsoft and Linux systems, and Microsoft intentionally makes that as difficult and expensive as possible.

    If you move everything over to Linux-based solutions, then these expenses evaporate. Worst-case, the costs become about the same as with Windows, and often are much less expensive.

     

    reply to this | link to this | view in thread ]


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here
Get Techdirt’s Daily Email
Save me a cookie
  • Note: A CRLF will be replaced by a break tag (<br>), all other allowable HTML will remain intact
  • Allowed HTML Tags: <b> <i> <a> <em> <br> <strong> <blockquote> <hr> <tt>
Follow Techdirt
Advertisement
Essential Reading
Techdirt Deals
Techdirt Insider Chat
Techdirt Reading List
Advertisement
Recent Stories
Advertisement
Support Techdirt - Get Great Stuff!

Close

Email This

This feature is only available to registered users. Register or sign in to use it.