The Israeli government will not renew a contract for various Microsoft desktop software’s at the end of the year, it said on Tuesday, citing a change in license terms it said would double the price reports.
Following its existing agreement with Microsoft Israel pays more than 100 million shekels ($27 million) a year for the procurement of Office desktop software, Windows and server software for ministries and government offices.
Microsoft is trying to shift Israel from a licensing system where it owns the software and can use the software as it wishes, to a subscription system that is similar to renting, informed the Finance ministry.
The ministry noted that the change, which includes moving data to the cloud, does not meet the government’s needs. It said the state had been negotiating with Microsoft officials in Israel for a year to no avail, reports Reuters.
Microsoft in Israel declined to comment.
As reported in Reuters, Israel plans to freeze the existing license structure owned by government ministries, which may be used without further payment.
The ministry added “This will also encourage government ministries to re-examine their needs of using Microsoft technology or switch to other technology alternatives.”
Microsoft Corporation is an American multinational technology company with headquarters in Redmond, Washington. It develops, manufactures, licenses, supports and sells computer software, consumer electronics, personal computers, and related services. Its best known software products are the Microsoft Windows line of operating systems, the Microsoft Office suite, and the Internet Explorer and Edge web browsers. Its flagship hardware products are the Xbox video game consoles and the Microsoft Surface lineup of touchscreen personal computers. As of 2016, it is the world’s largest software maker by revenue, and one of the world’s most valuable companies. The word “Microsoft” is a portmanteau of “microcomputer” and “software”.
Microsoft was founded by Bill Gates and Paul Allen on April 4, 1975, to develop and sell BASIC interpreters for the Altair 8800. It rose to dominate the personal computer operating system market with MS-DOS in the mid-1980s, followed by Microsoft Windows. The company’s 1986 initial public offering (IPO), and subsequent rise in its share price created three billionaires and an estimated 12,000 millionaires among Microsoft employees. Since the 1990s, it has increasingly diversified from the operating system market and has made a number of corporate acquisitions, their largest being the acquisition of LinkedIn for $26.2 billion in December 2016, followed by their acquisition of Skype Technologies for $8.5 billion in May 2011.