Microsoft’s pricing policy questioned in UK

LONDON: The Infrastructure Forum (tif), a body representing some of Britain's

largest companies' technology interests, said on Sunday it has asked the UK

government to investigate Microsoft's software pricing policies.

Tif, whose members include GlaxoSmithKline, BP, Shell and Marks &

Spencer, sent a letter on Friday to Patricia Hewitt, Secretary of State for

Trade and Industry, asking the government to refer Microsoft to the Office of

Fair Trading (OFT), a tif spokesman told Reuters.

Microsoft's new pricing policy could cost tif's members an extra 880 million

pounds over a typical four-year investment cycle, it said in a statement. The

group said the new pricing structure will result in a jump of almost 100 percent

in the cost of owning Microsoft licenses by forcing them to buy new software

each time they need to upgrade their systems.

Microsoft is due to release the latest version of its Windows operating

system next month.

"This money has not been budgeted for by organizations, so where will it

be found...Does Microsoft realize the damaging impact its pricing policy could

have on British business?" said David Roberts, chief executive of tif. The

group's 98 member organizations together spend around 18 billion pounds on IT

each year.

No-one from Microsoft was immediately available for comment.

"We are disappointed customers have felt the need to take this action. I

can't comment specifically about the OFT because we have not had an

approach," Duncan Reid, Microsoft UK's licensing manager, was quoted by the

Sunday Telegraph as saying.

The Sunday Telegraph said Reid believed the new subscription pricing system

being introduced by Microsoft was designed to simplify upgrades. "This may

represent a price increase over time for only 20 per cent of users," Reid

was quoted as saying.

(C) Reuters Limited 2001.