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Government procurement plans put incumbents at risk

by Dave Neal

05 Aug 2010

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Houses of Parliament
The government may be more open to smaller tech providers

Recent changes to government procurement plans could make it easier for new companies to win contracts, according to Ovum.

The analyst firm said that the dropping of provider Raytheon from the £750m eBorders programme highlights the fact that firms supplying technology to the government will face intense scrutiny that many may not stand up to.

This could help new entrants win contracts at the expense of incumbent suppliers.

The government has already hinted that it wants to change the way it procures technology. In an interview with V3.co.uk earlier in the year, Jeremy Hunt, now culture secretary, said that procurement would be broken down into chunks and could favour cheaper, open source providers.

"We will create a level playing field for open source IT throughout the public sector by introducing open standards for government computer systems," he said.

"This will help to open up IT procurement to open source solutions, and will also enable large scale IT projects to be split into small modular components.

He added that this will allow more small companies to win government contracts and drive down costs by increasing competition.

The number of failed technology initiatives already rocking Whitehall finances suggests that changes have to be made, and Ovum said that the dropping of Raytheon could spell doom for other firms.

Raytheon was dropped after officials cited "dissatisfaction" with its service just three years into the project, Ovum said.

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