Being open about lock-in

20th October 2016

By Nicky Stewart

Who would argue with the concept of an open and transparent government? Some have, notably Andrea Di Maio (Gartner), who in 2010 made the case against open government, arguing that the wisdom of the crowd (buoyed up by masses of out of context information) might destabilise volatile situations, or create uncertainty and fear.

From a digital perspective, “open” does not carry sinister undertones, and is fundamental to how government and technology providers will do business together. Open in this context is the polar opposite of the majority of government’s legacy technology engagements, which are – notoriously - anything but open.

To test how “open” open really is these days, I took at a look at all of the live UK technology related Voluntary Ex-Ante Transparency (V.E.A.T) notices. If you don’t already know, a V.E.A.T allows buyers to give formal notice of their intent to award a contract without a competition. The V.E.A.T must justify the award, and give sufficient for the decision to be challenged.

32 UK technology V.E.A.Ts are live at the time of writing (with a total minimum contract value of £50.2m). Just over 42% are justified on intellectual property grounds such as “for technical reasons, and the supplier’s exclusive rights” or “the software is proprietary in nature and can only be supported by the supplier”, and so on. Granted, the proportion of V.E.A.Ts is very small compared to all live contract notices, but they do show that the UK public sector hasn’t solved its problems with lock-in yet.

There are many other ways that a vendor can lock in its customer: exclusivity clauses; long term contracts without break clauses and penalising a customer for leaving a contract early are common. Complex, proprietary technology and high switching costs are also equally effective forms of lock in. It is not uncommon to see tactical contract extensions awarded in order to give the customer time to work out how it gets out of such an uncomfortable arrangement. Win-win for the vendor.

Within the UK public sector, vendor lock-in is not generally associated with digital. G-Cloud is specifically designed to counter lock-in. No contract can have a term of more than 2 years, and all contracts allow customers to break for convenience.

What G-Cloud doesn’t do is prevent its vendors from penalising customers for breaking for convenience, nor does it mandate open standards or open source.

In you have an idle moment, take a quick look at some of the G-Cloud 8 IaaS offerings available on the Digital Marketplace, and look at them from the perspective of lock in. It makes for an interesting read.

Some, like UKCloud, are entirely in line with what you would expect for a pure play cloud service. No commitment to term, or to consume services. The buyer can terminate at will without any form of penalty (in fact, the user can simply stop consuming the services and export their data – the bills will stop). Others are not so straightforward:

• A global IaaS provider will hold your data hostage until you have paid all “post termination costs”, and any other amounts due
• Use of proprietary feature sets from that same provider, and others, ensures applications cannot be migrated to other providers without considerable application re-writes.
• Many will set a minimum call-off term of 1 year, and early termination will not excuse you for liability for a full year’s charge
• Many do not support open source or open standards
• Many explicitly state that termination charges will apply, but are not transparent about what those charges might be

So lock in still exists, even in the brave new digital world. What digital has really got going for it in favour of “open” is choice. The buyer can choose from thousands of cloud services, from hundreds of vendors. For every “closed” service the buyer will find an “open” service. Ultimately the buyer will determine the degree, or otherwise, of lock-in government will experience tomorrow, and in years to come within its cloud services.

Caveat emptor!

Author: Nicky Stewart