In a letter to The Patricia Hewitt, Secretary of State for Trade and Industry, tif is asking the UK government to investigate immediately what it describes as Microsoft's “Windows tax”. According to tif., whose 98 members organisations encompass 22 of the FTSE top 50 and collectively spend £18 billion on IT annually, Microsoft is imposing a new pricing policy on its customers which could see tif members alone paying an estimated additional £880 million over a typical four year investment cycle.
With Microsoft products being the de facto standard for desktop and laptop computer software, tif members believe that the company's new pricing policy amounts to an abuse of its dominant position under the terms of the UK’s Competition Act of 1998. At a meeting of tif held on 19th September, members voted unanimously to bring the issue to the direct attention of Patricia Hewitt, in both her role as Secretary of State at the DTI and as e-minister to the Cabinet.
"Our members have been loyal Microsoft customers for many years and they are furious. This new pricing policy is a slap in the face of every Microsoft customer. For our members and all UK businesses, there are no immediate alternatives to using Microsoft software and the company knows this," said David Roberts, chief executive of tif.
Roberts continued, "At a time of economic downturn, Microsoft is telling its customers to dip further into their pockets. But for what? Microsoft have added a few bells and whistles to its new software, but research amongst our members reveals that these have not been requested and are not wanted."
Tif has made representations to Microsoft regarding the new pricing structure but received responses indicating that Microsoft has no intention of reconsidering its position. The results of these discussions were reported to tif members on 19th September resulting in the decision to take the issue to the Government.
Also at the meeting tif members, whose organisations have collectively over 2.2 million desktop PCs and laptops and a further 52,000 Microsoft related servers, reported that whilst they have few options at the moment, they are seriously looking into migrating away from Microsoft products and delaying new purchases if Microsoft persists with its plans. Many members have already called a halt to new Microsoft projects.
David Roberts continues, "Research amongst tif members reveals that the new pricing structure will result in a jump of almost 100% in the cost of owning Microsoft licences. This money has not been budgeted for by organisations, so where will it be found? From less investment in R&D, from lower recruitment? Does Microsoft realise the damaging impact its pricing policy could have on British business?"