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Red Hat sues Swiss government over no-bid Microsoft contract

Sam Alderwick   on 27 May 2009 - 16:10 · 51 comments & 8898 views

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According to a blog post by Red Hat, Microsoft was given a three year contract, with no public bidding, which Red Hat and 17 other technology groups are appealing. The contract was worth 14 million Swiss Franc (approximately equivalent to £8m or $12m) per year, and was awarded by the Swiss Federal Bureau for Building and Logistics, for "standardized workstations" and the applications and support that go with it.

The government agency claimed the decision was made because there was "no sufficient alternative to the Microsoft products", however Red Hat stated that several other Swiss government agencies are using alternatives, provided by Red Hat.

Red Hat produce open-source software, namely Linux operating systems, which are targeted towards the commercial market. The money is made by selling subscriptions, which provide support for their products, amongst other services.

Red Hat is leading a group of 18 technology companies who are "seeking a public bidding process that allows for consideration of the technical and commercial advantages of open source software products". The companies have filed a brief with Swiss Federal Administration Court, and aim to have the contract with Microsoft overturned.

Open-Xchange, one of the other companies offering alternatives, said "We have alternatives to what Microsoft is offering, so at least we should have a chance at the bidding process," according to an article by PC World. "The IT landscape changes so rapidly, it makes sense to have the freedom to change components without lock-in."

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(4 replies) #1 +majortom1981 on 27 May 2009 - 16:46
Honest question, is there an alternative to group policy in linux? Also with all the maintanance tools and diff server maintanance products I think there are still some things for big networks of computers that you still cant do in linux.

Dont bash me if there is a group policy alternative or Microsoft systems center alternative then show me the product instead of bashing me.
#1.1 toadeater on 27 May 2009 - 21:43
majortom1981 said,
Honest question, is there an alternative to group policy in linux?


There are several. Samba is the most popular AFAIK.

http://www.itworld.com/open-source/61117/a...s-linux-samba-4
#1.2 GreyWolfSC on 27 May 2009 - 22:48
SAMBA is an open-source version of SMB. It's not group policy, it's a LAN protocol.
#1.3 ichi on 27 May 2009 - 23:37
GreyWolfSC said,
SAMBA is an open-source version of SMB. It's not group policy, it's a LAN protocol.


It's quite a bit more than just that, check the SAMBA documentation.

You can get group policies running SAMBA3 along with some third party tools, but it's being integrated in SAMBA4.
#1.4 Solid Knight on 28 May 2009 - 03:08
While there are tools that attempt to emulate GPO and AD they aren't nearly as nice to work with.
(4 replies) #2 +chrismaddern on 27 May 2009 - 16:56
There exist alternatives, but nothing as strong or ubiquitous as Group Policy or Local Policy exists.

Also... if someone wants to sign a contract with Microsoft (or any other company), why on Earth should a competitor have a right to complain.

It's like somebody signing a contract with me and my friend taking them to court because they didn't talk to them about the potential of a deal first?!
#2.1 Sazz181 on 27 May 2009 - 17:00
I think it's because it's a government matter, and that the taxpayers money should be spent in the most appropriate way. And that's why different companies "bid" it out to convince the government that they are providing the best offer.
#2.2 GreyWolfSC on 27 May 2009 - 17:09
Linux can actually do that, too. My issue is I see no reference to evidence that the FOSS alternative would still be cheaper including app re-writes, training, and migration. I'm also confused by the statistics. Supposedly the Microsoft contract was worth 14M pounds, but the proponents are claiming a 600M pound savings? Are they suggesting that Switzerland will create 586M pounds by switching?
#2.3 ichi on 27 May 2009 - 18:17
GreyWolfSC said,
Linux can actually do that, too. My issue is I see no reference to evidence that the FOSS alternative would still be cheaper including app re-writes, training, and migration. I'm also confused by the statistics. Supposedly the Microsoft contract was worth 14M pounds, but the proponents are claiming a 600M pound savings? Are they suggesting that Switzerland will create 586M pounds by switching?


The £600m (per year) saving was an estimation made by the UK government. It was presented here just to show that there's actually enough incentive to run a bidding process.
#2.4 Julius Caro on 27 May 2009 - 23:39
@chrismaddern, when it comes to government contracts, competitors DO have the right the complain. in spain a contract between microsoft and the government would not be very legal if there wasnt a public bidding before. like, the government says what it needs, and companies submit proposals with prices and that stuff (to sum up = a bid).
(2 replies) #3 Rudy on 27 May 2009 - 17:09
As Sazz181 just said, it's not just a company that decided they wanted to use Windows. Governments have to be accountable and they always have to analyze the options they have and allow different companies to "bid" to be able to provide the service for the lowest cost.
#3.1 nowimnothing on 27 May 2009 - 17:15
And in my experience, government entities tend to waste as much or more money going through the motions of finding bids as they stand a chance to save by not just going with the first/most well-known option. It's another one of those "good in theory, bad in practice" concepts, imho.
#3.2 hkgonra on 27 May 2009 - 17:22
Most governmental entities in the U.S. HAVE to have an open bid process for any purchase over a certain amount. For the city I live it is anything over $500. One bad part about that is that competitors will all jack up prices across the board. The other common thing I see is that the bid requirements will be constructed in such a way that only one company can possibly meet the specific requirements.
#4 ccoltmanm on 27 May 2009 - 17:13
Microsoft does stuff well. If they make an agreement with a government that is solid, which i would imagine, citing MS's record, is a good thing, who cares, competitors.. ah that's who.
#5 Magallanes on 27 May 2009 - 17:48

A MS executive doing it well.
(7 replies) #6 Aahz on 27 May 2009 - 18:06
One of the major selling points for an enterprise making the switch to Linux is the fact that it's open source and free. The idea being that you would spend a small amount of money on training and then actually save tons of money on the OS licenses/support.

Red Hat, however, isn't free and once you are already in the mood to spend on an enterprise solution you tend to want the best solution rather than the geekiest one.
#6.1 C_Guy on 27 May 2009 - 19:45
Oops! It has been well documented that Windows has a lower total cost of ownership (TCO) than Linux. Sheesh.
#6.2 roadwarrior on 27 May 2009 - 20:32
C_Guy said,
Oops! It has been well documented that Windows has a lower total cost of ownership (TCO) than Linux. Sheesh.


Well documented in Microsoft-sponsored studies, that is.
#6.3 toadeater on 27 May 2009 - 21:44
roadwarrior said,
Well documented in Microsoft-sponsored studies, that is.


Mission accomplished.
#6.4 Solid Knight on 28 May 2009 - 03:18
Training costs a hell of a lot more than people think and you have to factor in time-lost in the switch in addition to time-wasted trying to gain back functionality you've lost (Linux is behind in many areas in the corporate IT world/desktop). You also may have to custom software to rewrite or repurchase.

Switching is a hell of a lot more complex than loading up some new software you downloaded off the internet.

And of course if you move into the Linux world you end up having far less choices of third-party software than you do with Windows. I know Linux zealots like to say the reverse however it is only true that Linux has more choices in a very narrow field of software; like window managers and whatnot.
#6.5 ichi on 28 May 2009 - 10:59
Solid Knight said,
Training costs a hell of a lot more than people think


Depends on what people needs to do.

French police needed "little to no training"(sic) when switching to Linux.
#6.6 vetmarkjensen on 28 May 2009 - 11:34
Solid Knight said,
...
Switching is a hell of a lot more complex than loading up some new software you downloaded off the internet.
...

Funny, but a recent report shows that organizations found it was easier than expected to switch to Linux on desktops.
#6.7 Solid Knight on 28 May 2009 - 18:41
That article is extremely vague. What kind of organizations found it easy to switch? How big were they? What do they do? Who are the "right-end users"? Sure, I bet it'd be easy to switch for certain types of small business that don't need a robust infrastructure and don't spend a lot of time collaborating with their PCs or don't need professional grade, industry standard applications but that's not the case for a lot of other businesses.
(4 replies) #7 +majortom1981 on 27 May 2009 - 18:07
Also if international governments are the same microsoft will heavily discount products to get the bid. So the thing is would red hat being able to bid actually have made a difference. ps i am a civil service employee here in New York
#7.1 ichi on 27 May 2009 - 18:22
majortom1981 said,
Also if international governments are the same microsoft will heavily discount products to get the bid. So the thing is would red hat being able to bid actually have made a difference.


Of course it would, you have pointed it yourself: if they had still finally decided to go with MS, Switzerland would have paid a whole lot less for their current contract.
#7.2 +majortom1981 on 27 May 2009 - 20:11
ichi said,
Of course it would, you have pointed it yourself: if they had still finally decided to go with MS, Switzerland would have paid a whole lot less for their current contract.


Microsoft without bid still heavily discounts products for government. we get office 2007 standard for $20 a copy.
#7.3 ichi on 27 May 2009 - 21:55
majortom1981 said,
Microsoft without bid still heavily discounts products for government. we get office 2007 standard for $20 a copy.


Sure, but going through a bid you either get a better product or a better price. Or both.
#7.4 vetmarkjensen on 28 May 2009 - 11:36
ichi said,
Sure, but going through a bid you either get a better product or a better price. Or both.

Exactly!

The customer gains by competitive bids. Even if they stayed with Windows, they likely would have gotten additional concessions from Microsoft.

One would have to be pretty dense to not see that and to support closing of competitive bids.
(3 replies) #8 WAR-DOG on 27 May 2009 - 18:19
It's not everything in the money, it's about GUI and userfriendly designs
#8.1 artzm on 27 May 2009 - 20:11
WAR-DOG said,
It's not everything in the money, it's about GUI and userfriendly designs


This is a government we are talking about here....they don't care about design vs cost.
#8.2 LaP on 28 May 2009 - 13:35
WAR-DOG said,
It's not everything in the money, it's about GUI and userfriendly designs


If it's about the GUI then companies should switch to Open Office 3 which looks and behave like the old Offices while Office 2007 has a new ribbon UI.
#8.3 ichi on 28 May 2009 - 17:21
WAR-DOG said,
GUI and userfriendly designs


If it comes to just that then the option is clear: nipples.

As userfriendly and intuitive as an interface can possibly get.
(2 replies) #9 wakers01 on 27 May 2009 - 19:18
This one actually makes sense. These types of public contracts need to be open to bidding in order to remain in the best interest of the people. Otherwise, you end up with back room handshaking, palm greasing, whatever you want to call it.
#9.1 hkgonra on 27 May 2009 - 20:29
Don't fool yourself, you still get that even with bids.
#9.2 S00N3R FR3AK on 28 May 2009 - 04:21
hkgonra said,
Don't fool yourself, you still get that even with bids.


lol yeah this stuff is always going to happen its what makes the world go round.
(3 replies) #10 C_Guy on 27 May 2009 - 19:44
Wow, takes "sore loser" to a whole new level. Way to go, red hat!

I wonder if I will be able to hear the judge's laughter from over here as this gets thrown out of court for having absoltely no legal ground whatsoever.
#10.1 Marcos_Edson on 27 May 2009 - 19:56
Did you actually understand the matter?
#10.2 artzm on 27 May 2009 - 20:13
C_Guy said,
Wow, takes "sore loser" to a whole new level. Way to go, red hat!

I wonder if I will be able to hear the judge's laughter from over here as this gets thrown out of court for having absoltely no legal ground whatsoever.

C_Guy it is illegal in most countries not to bid on government contracts. (as far as I know) And you can't "lose" if you were never "playing".
#10.3 S00N3R FR3AK on 28 May 2009 - 04:22
artzm said,
C_Guy said,
Wow, takes "sore loser" to a whole new level. Way to go, red hat!

I wonder if I will be able to hear the judge's laughter from over here as this gets thrown out of court for having absoltely no legal ground whatsoever.

C_Guy it is illegal in most countries not to bid on government contracts. (as far as I know) And you can't "lose" if you were never "playing".


But has anyone quoted sweedish law to show if it is legal or illegal?
(6 replies) #11 gigapixels on 27 May 2009 - 22:57
I don't see a problem, to be honest. Sure, if we were talking about the hardware with Dell getting a contract instead of any other company without bidding, then I'd see the issue. They're selling equivalent products and really the only issue is cost. But Windows and Linux are not equivalent; the experiences are quite different. How much would it cost to train all the employees on the use of Linux? They likely all know how to use Windows and probably have very little experience with Linux.

I'm not biased by any means... I use Linux quite a lot, usually just as much as Windows, and I do enjoy it very much. But the fact here is that the agency and its employees may have a preference as to what OS they'd like to use on their computers. I don't see a problem with that.
#11.1 ichi on 27 May 2009 - 23:50
gigapixels said,
How much would it cost to train all the employees on the use of Linux? They likely all know how to use Windows and probably have very little experience with Linux.


The question is: would the cost of training all employees + Red Hat's (or any other company) licenses/support come cheaper than MS licenses/support?
The answer: you can guess, but since they didn't run a bid there's no way to know.

Anyway bear in mind that training costs are a one time expense, as opposed to licenses and support contracts. Switching platforms is always likely to be more expensive in the short term, but you can get that investment returned latter.

I'm not saying that this would be the case here, it might or might not, just that training costs are not a show stopper.
#11.2 Ledward on 28 May 2009 - 00:37
$12m USD really is nothing; tax from maybe 100 people- training the entire govt to use Linux will probably cost more, way more. How long did you want to wait to recover your investment?
#11.3 ichi on 28 May 2009 - 07:59
Ledward said,
$12m USD really is nothing; tax from maybe 100 people- training the entire govt to use Linux will probably cost more, way more. How long did you want to wait to recover your investment?


100 people paying $120000/year in taxes?

Going by the factual data (or more exactly, lack of thereof) we could also say training people to use Linux would probably cost way less.
Red Hat is already being used extensively in other government agencies in Switzerland, maybe someone could go and ask
#11.4 Ledward on 28 May 2009 - 08:53
ichi said,
100 people paying $120000/year in taxes?

Going by the factual data (or more exactly, lack of thereof) we could also say training people to use Linux would probably cost way less.
Red Hat is already being used extensively in other government agencies in Switzerland, maybe someone could go and ask

typo- meant to be 1000 (though that might have been obvious)
#11.5 ichi on 28 May 2009 - 12:34
Ledward said,
ichi said,
100 people paying $120000/year in taxes?

Going by the factual data (or more exactly, lack of thereof) we could also say training people to use Linux would probably cost way less.
Red Hat is already being used extensively in other government agencies in Switzerland, maybe someone could go and ask

typo- meant to be 1000 (though that might have been obvious)


That's still $12k per year.
Considering the average Swiss household income is about $8k that would be one hell of an income tax.

*edit: I've just found a different source giving different numbers for household income :-/ never mind.

Last edited by ichi on 28 May 2009 - 12:41
#11.6 LaP on 28 May 2009 - 13:38
Ledward said,
$12m USD really is nothing; tax from maybe 100 people- training the entire govt to use Linux will probably cost more, way more. How long did you want to wait to recover your investment?


Taxes from 100 people

OMG and i thought canadian was the most taxed people on hear.

12 000 000 / 100 = 120 000 / 3 years = 40 000 taxes a year WOW just WOW

I live in Quebec which is one of the most taxed place onm hearth and i pay around 5 000-6 000$ of taxes a year at most even if i have a very good salary.
(2 replies) #12 Hitman2000 on 28 May 2009 - 05:04
simple really hold a bid open it for a week then choose ms anyway.

i hate how all these compnies always want to complain about MS.
MS is the top dog for a reason, they get **** done despite all the bugs,virus and and whatever else apple/linux think is wrong with MS.
#12.1 vetmarkjensen on 28 May 2009 - 11:38
Hitman2000 said,
simple really hold a bid open it for a week then choose ms anyway.

i hate how all these compnies always want to complain about MS.
MS is the top dog for a reason, they get **** done despite all the bugs,virus and and whatever else apple/linux think is wrong with MS.

(sigh)

Please read and understand the article.

The complaint is against what Switzerland did. Not Microsoft.
#12.2 ichi on 28 May 2009 - 12:02
Hitman2000 said,
simple really hold a bid open it for a week then choose ms anyway.


How about holding a bid and choosing the best offer?
What's wrong with trying to get the most value out of taxpayers' money?

I understand MS obviously prefers not going through a bid and getting the contract right away, but what's in that for everyone else supporting non-bid contracts?
(1 reply) #13 Sewje on 28 May 2009 - 09:58
Yea sure, re-train them to point and click I'm sure lot of them don't know this yet. Why do people think re-training is some rocket science **** that will cost NASA amounts of money training. People aren't stupid, or do the goverment employ stupid people?
#13.1 LaP on 28 May 2009 - 13:42
Sewje said,
Yea sure, re-train them to point and click I'm sure lot of them don't know this yet. Why do people think re-training is some rocket science **** that will cost NASA amounts of money training. People aren't stupid, or do the goverment employ stupid people?


Companies ALWAYS retrain anyway. We got an half day trainning for going from Outlook 2000 to Outlook 2003 here ....

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