WASHINGTON—A new report from Garland Management Consulting, sponsored by NetChoice, finds that reforming the IT monoculture in federal government software licensing procurement could save taxpayers around $750 million per year through increased competition.
The report, researched and written by noted procurement expert Michael Garland, exposes how a few massive IT companies have built a Federal software monopoly with sole-source contracts and questionable business practices at a steep price to American taxpayers.
This concept, called “vendor-lock,” has allowed software vendors to leverage their dominant position to impose a number of harmful, anticompetitive practices on the government and taxpayer resources.
As government spending continues to be a hot topic in Congress, especially as the debt ceiling crisis continues, reforming IT licensing practices is a straightforward, bipartisan approach to save taxpayer dollars, like the SAMOSA Act, which was previously introduced in the 117th Congress.
The report, compiled from thousands of government contracts and drafted by an independent procurement expert, provides never-before-seen insight into how software monopolists lock in federal agencies. Some of their most abusive practices include:
- Requiring the government to repurchase existing software in order to use applications in competitive cloud environments;
- Forcing the government to pay an inflexible fixed amount in annual support fees (despite reductions of deployed software);
- Allegedly using pernicious auditing practices to find questionable contract violations as leverage to negotiate further lock-in, even when the government has expressed a preference for other products.
In the report, Garland summarizes:
“The COTS software estate can be managed better, vendor-lock and its negative effects can be mitigated, and the government can gain better pricing and innovation by simply putting a focus on competition, diversity and interoperability.”
“Garland’s report has exposed how vendor-lock has imposed significant costs on taxpayers, to the benefit of the world’s largest software vendors,” said NetChoice President & CEO Steve DelBianco. “It’s well past time that Congress acted to unlock competition in the federal IT market.”
You can review the full report from Garland here, the report’s summary here and a one-pager on the report here.
Please contact Krista Chavez at press@netchoice.org if you would like to speak with Garland about his findings.