Renewing federal software purchases may force Microsoft to make changes

(Bloomberg) — The top Democratic senator responsible for government oversight is drafting legislation that would reform how the federal government buys software, a move that could force Microsoft Corp. and Oracle Corp. And other technology companies are removing restrictions on how their products interact with those made by competitors.

The bill, a copy of which has been obtained by Bloomberg, would require agencies to move toward purchasing unlimited software licenses, rather than buying licenses for a specific number of employees. These contracts, known as “enterprise licenses,” can save money by eliminating additional costs when software is overused.

The legislation, written by Senator Gary Peters, the Michigan Democrat who chairs the Senate Homeland Security and Governmental Affairs Committee, authorizes government purchasers to review all of their software, including any rules that limit how it can be used on computers, servers or the cloud. providers.

The bill is still in the works, according to Peters’ aide, and is subject to change. His office has not commented on when the measure will be implemented. But the senator’s sponsorship boosts the bill’s likely passage, given his role as chair of the main committee.

While the bill does not identify any software makers by name, if passed into law, it would affect how companies like Microsoft and Oracle sell their products to the federal government.

Microsoft has come under fire from customers and competing cloud vendors like Amazon Web Services and Alphabet Inc.’s Google Cloud Platform for licensing rules that make running products like Windows and Office in the cloud harder, more expensive, or in some cases impossible, even if customers have purchased Already have licenses to use these programs.

A 2014 GAO review found that most agencies do not adequately manage their software licenses, resulting in higher costs when purchasing duplicate licenses or paying fees for violating license terms. Two years later, Congress passed a law requiring each agency to establish a software licensing policy and keep track of its purchases.

Peters’ bill would build on that bill, which his office said has saved the federal government $450 million since its passage. In addition to requiring each agency to move to unlimited software licenses where possible, the legislation also suggests that the administration make plans to adopt government-wide licenses for popular software as a move to further reduce costs and use its purchasing power to enhance interoperability — the seamless transfer of data and information between systems.

The bill also requires agencies to define restrictions in software licenses on how software can be used and come up with ways to reduce those restrictions.

The federal government has committed about $92.2 billion to spending on information technology in fiscal year 2021. Each of the 24 federal government agencies contracts on its own, buying thousands of software licenses each year, to me Government Accountability Office.

Last month, Microsoft detailed some changes to its licensing policies to make it easier to run existing software in the clouds held by smaller providers, but the company hasn’t addressed licensing restrictions related to the software maker’s joint customers with Google, Inc. And on Alibaba China. Amazon said in a statement last month that the new changes, the exact language of which has not yet been released, add new boundaries that affect it and its partners.

The lack of software interoperability has also hampered some government projects such as efforts to link the Department of Defense electronic medical records system to the system operated by Veterans Affairs. VA signed a $10 billion contract in 2018 to move from its electronic health records system to one developed by Cerner Corp, which was recently acquired by Oracle.

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