Analysis Hidden in Microsoft's deal to supply over half a million client desktops at the US department of defense is one of the year's most intriguing stories. The services and other agencies under the Pentagon will receive a bespoke version of Windows: a sign that Redmond is preparing to counter slower growth in its license revenues by cranking up its professional services business. Earlier this month, Microsoft locked in the UK's largest employer, the National Health Service, to a 9-year, 900,000 desktop deal which also saw users promised a bespoke client version of Windows, specially tailored for the NHS.
Quite how "customized" this Windows.mil desktop will be remains to be seen. Given Microsoft's natural propensity to develop complicated client-side solutions, it will clearly involve more than replacing Internet Explorer's spinning e with a spinning eagle, or even a winking chess knight. Microsoft's logic is surely similar to IBM's: the technology may become passé, but it will still need servicing, and Microsoft itself is in pole position to win that services business.
It provides Microsoft with a steady, predictable annual revenue stream, something which has eluded it with the poor take up of Licensing 6.0, compounded by its own inability to get major Windows milestones out of the door. Patent revenues may also provide a supplement to Microsoft's licensing income, but we discounted the possibility of a litigation offensive.
It's only slightly ironic that Microsoft should now be so keen to develop bespoke versions of Windows. For many years Redmond refused to allow its OEMs to put their own icons on the desktop or alter the boot sequence, citing uniformity and consistency of the UI. And as a further aside, we note that the USAF's CIO John Gilligan revealed that the force spent "more money patching and fixing, than buying software," according to one report. So Microsoft's security problems may yet give its Professional Services Group an advantage. We also note that Bob Cringely has been hearing the same stories we have, although in Bob's version, Microsoft gives away WinFS to save the world: a scenario we have some difficulty imagining.
Microsoft's sales pitch in both cases is to make the supply chain more homogenous - at least superficially. The NHS' IT boss Richard Granger boasted that the deal provided the Health Service with "a common look and feel of all clinical applications to improve patient care and safety across the NHS."
This, however is not the full story, as we pointed out at the time. And open source strategists should view this with some concern. To date the goal for many FOSS projects has been to provide a like-for-like, file-compatible alternative, with the menus in the right place, and compete on cost. But this might not be in enough in the real world. Microsoft won its NHS contract by writing the specification in such a way so that only Microsoft could meet the requirements -
"Sun JDS [Java Desktop System] could only win the contract if it could do all, not just 'most' or 'enough' of what a full-spec, up to date XP/Office combination could do. It's clearly impossible, and you could therefore say that requirements of this stringency are 'auto-lockin'."
Here it helps to have friends in high places. Arise, Sir Bill. ®