Over 80 percent of suppliers on the government's G-Cloud IT procurement framework have never made a sale through the platform, V3 has learned.
G-Cloud is a framework agreement combined with an online "CloudStore" to allow public-sector organisations to buy cloud products and services. It was created in 2012 in a bid to level the playing field between small IT suppliers and global tech giants such as IBM and Microsoft, thereby saving taxpayers money by making public-sector IT more competitive.
Last year, the platform had its initial budget of £1m boosted and its staff count doubled in a bid to improve public sector uptake.
Following a freedom of information request submitted to the Cabinet Office by V3, it has emerged that the platform is not being used as intended. In November 2013 – when the latest figures were available – just 181 of the 1,058 suppliers present on G-Cloud had made sales.
The figures highlight problems in the way G-Cloud is used by public-sector organisations. V3 interviewed a number of small and large IT suppliers that are present on G-Cloud, and while they were universally supportive of the scheme, they all pointed towards G-Cloud being used as a "shop window" instead of a place to make transactions.
Total public sector spend on G-Cloud has reached £92m with 56 percent of money spent going to smaller IT firms. However, the figures obtained by V3 indicate that the figure could have been higher if more transactions were made through G-Cloud. Instead, public sector buyers are working around it.
Mark Fenna, head of public sector at cloud customer relationship management software firm eGain, explained: "We've had enquiries through G-Cloud but none of those have yet converted into contracts. Of all the interactions we've had so far we'll probably transact them outside of G-Cloud."
While it is a fairly low-risk exercise for a larger business to be on G-Cloud, Fenna said the platform is not suitable for more complex buys, meaning they end up taking place outside of the platform.
Matt Franklin, public sector sales director at systems integrator Logicalis, said G-Cloud is important for the company's brand. "It's an important shop window for us," he said.
"There's a lot of positivity around the brand and the association with G-Cloud, which recognises us as a supplier. It's been an effective tool that's enabled our customers to validate our credentials. In reality [our services are] typically then procured through alternative frameworks."
Kevin Long, UK business development director for data warehousing firm Teradata, added that the design of the CloudStore and its terms did not lend itself to more complex deals. "I think it is very hard to find services and to use the current infrastructure to compare alternatives," he said.
"We're finding people find an entry like ours and then go through traditional ways of finding more information, and go for a more bespoke approach," he explained.
The Cabinet Office, which oversees the Government Digital Service, which in turn runs the G-Cloud project, said being listed on the CloudStore does not guarantee sales.
"There is no guarantee of business under any framework agreement, but all suppliers services are visible to customers via the CloudStore for selection based on their fit with the customers' needs and value for money," a statement read.
A Cabinet Office spokesperson added: "We are constantly looking at how CloudStore itself can be improved to assist buyers and suppliers."
Yesterday, V3 revealed that the Cabinet Office has removed around 100 irrelevant services from the CloudStore as it looks to clarify the scope of the G-Cloud framework.
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