Microsoft has dismissed claims that Linux is more cost-effective for businesses, arguing that Windows is cheaper over its total lifecycle.

When asked by Gartner about Microsoft's intensifying battle against the open source operating system, European president Jean-Phillipe Courtois claimed that Linux is in fact more expensive to run than Windows.

Arguments that Linux is free, and therefore a good alternative for governments and organisations on a tight budget, are incorrect, he said.

Courtois claimed that Microsoft has been tracking the total cost of ownership (TCO) in 12 organisations across a range of business sectors, and that in 95 per cent of cases the "TCO was better on the Windows platform".

Licensing costs account for just five per cent of the total cost of an operating system, he said, and those plumping for Microsoft have an easier life in terms of application integration both internally and with external business partners.

But Courtois was challenged by Peter Sondergaard, Gartner's president of research in Europe.

He argued that the perception among chief information officers is that Linux and open source software is more cost-effective than Windows and Microsoft's Office applications.

"I do expect that some of your clients are looking for a response on licensing or more flexibility in the packaging," he said.

Courtois replied: "As soon as you start digging down you go beyond licensing. It's not that we are perfect with licensing; we need to make it simpler. But it's about the end-to-end environment."

He claimed that, with such a rich diversity of software applications and hardware devices now on the market, companies can achieve tighter integration by using Windows.

However, there is growing interest in Linux in the public sector. Last month, West Yorkshire police took delivery of Linux desktops as part of a trial for the operating system for English and Welsh forces.

And the European Commission handed open source advocate Netproject a €250,000 (£160,000) contract to conduct a feasibility study into running the operating system in government departments.