Microsoft And HP Express SME Concerns

Jul 07, 2014

Two government tech supplier giants, HP and Microsoft, are claimed to have expressed “concerns “over government plans to award more contracts to SMEs.

 According to report in The Independent newspaper, HP, which was recently named as the single largest government supplier, wrote to HM Treasury to discuss its worries.

Both IT giants claim they are being “singled out” by government attempts to introduce more SME suppliers.

In the letter, the firm is alleged to have questioned whether competing for contracts is now worthwhile because the government seems uninterested in doing business with multinationals.

HP reportedly feels threatened by “red lines” published earlier this year that would limit IT contracts to £100m – quite different from the £1bn it earns from Whitehall contracts annually now.

Despite its concerns, last month the company announced its support to SMEs with a G-Cloud initiative decided to increase smaller companies’ chances at gaining government business.

Microsoft Worried About Dropping Office Sales

Meanwhile, Microsoft is said to be fighting a battle with the Cabinet Office to ensure it continues to receive £1m annually from Whitehall via Office sales.

It seems to be particularly worried about Cabinet Office Minister Francis Maude’s push for the use of Open Source – a move that will likely damage to millions of pound the firm earns from selling its Office suite.

In February, Microsoft published a blog post explaining why it felt that Open Source was not the best move for Whitehall to make.

However, the Cabinet has denied receiving HP’s letter, claiming the suppliers’ concerns are unfounded.

“We value the contribution companies of all sizes make to the UK economy, driving innovation, growth and jobs,” it claimed.




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