AMSTERDAM, 24/12/04 - The government has dropped a mega-contract with Microsoft, a spokesman for the software giant confirmed yesterday. Government services and a number of municipalities had been on the point of concluding a contract for the supply of software for 245,000 workstations.

Microsoft has understood that the ministries involved could not agree on a single large contract. The spokesman termed that "a pity," but stressed that there already are a whole series of agreements for the supply of software to government institutions.

Political parties, social organisations and companies expressed their concern last month about the government's exclusive negotiations with the software giant. The Socialist Party (SP), centre-left (D66), Labour (PvdA) and leftwing Greens (GroenLinks) wanted among other things to know why the government was only doing business with a company that has been found guilty of infringing competition laws.

The negotiations are also in conflict with a motion adopted unanimously by the Lower House two years ago, according to the parties. The House specified at the time that the government must combat concentrations in the software market and make use of open source software.

The organisations termed it dubious that the contract, said to be worth 147 million euros, was not put up for public tender. With a large number of participants, ministries and local authorities, the intention had been to push down the costs as much as possible. ?