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By silicon.com, 18 July 2003 14:47

COMMENT The news that the NHS is planning to change its Microsoft deal for half a million licences in order to boost the government's block purchasing power and trigger major discounts throws up a number of interesting and unanswered issues. While the move will double the government's block purchasing power and lead to savings mooted to be in the £12 per licence bracket – leading to overall savings of millions of pounds - the NHS will actually be slightly worse off per licence. It isn't a vast sum we are told but it would nevertheless still be a sizeable downpayment on a new hospital wing. So is the cash-strapped NHS just being extremely selfless? On face value it doesn't really add up. The government's central buying agency the Office of Government Commerce was unable to say whether any of the millions of pounds of savings that will come about as a result of the NHS switch will indeed be passed on to the NHS itself. One would hope so given the size of the task of modernising the crumbling health service infrastructure over the next few years. The other thing that doesn't add up is the government's figure for how much the NHS spends on Microsoft software. Microsoft and the NHS Information Authority were reluctant to go on the record criticising health minister John Hutton but admitted they didn't have a clue where his figures came from. He told Parliament a week ago that the NHS spends over £60m a year on Microsoft licences. We've had no response from the government yet, so we still don't know whether it was a slip of a civil servant's finger on the department's abacus or whether there is a real discrepancy over the actual figures. We intend to keep you in touch on that front, though. Finally, Microsoft admits that it doesn't usually allow customers to switch from a subscription to a perpetual licensing agreement but that in the case of the NHS it will make an exception. This is indeed a positive side to Microsoft and benefits both the NHS and taxpayers, though the bargaining power of some half a million licence fees also probably played its part. But it also raises the question of whether any large corporate customers will want to try – and whether they will be allowed – to cut similar deals with the Redmond giant. While on the face of it this is good news for the NHS, Microsoft and taxpayers, there are still important questions that remain unanswered.