The government has warned the channel that multi-million-pound public sector IT contracts are now a thing of the past.
Speaking at supplier summit in central London yesterday, Cabinet office minister Francis Maude told delegates that "the days of the mega IT contracts are over" and the government will no longer be offering suppliers "easy margins".
As a result, Maude told attendees - including representatives from CapGemini, BT, IBM and HP - they will need to change the way they approach public sector procurement in the future.
"We will need you to rethink the way you approach projects, making them smaller, off the shelf and open source where possible," explained Maude. "We will expect you to be transparent in all your dealings with us and for the terms of the contracts we sign with you to go up online."
Maude said the changes were necessary to help streamline the procurement processes, making them more cost effective and quicker to resolve.
Citing figures obtained from government suppliers, Maude said procurement processes are taking an average of 77 weeks to complete and cost between £20,000 and £200,000 a month.
He added: "This is just wasted time and money on both sides of the equation and it is something we urgently need to address."
The event was not all doom and gloom for the channel, as Maude announced that the government is intent on opening up the public sector market to smaller players.
He said: "We will open up the market to smaller suppliers and we will expect you [suppliers] to partner with them as equals, not as sub-ordinates."
Bindi Bhullar, director at IT services provider HCL, said: "This is the clearest indication yet that the era of bloated IT contracts is coming to an end, and not before time.
Infrastructure provider says international sales now make up 51 per cent of its revenue
Suzanne Chappell of TMS plans sailing venture after selling Oxfordshire-based TMS to acquisitive Chess
Withdrawal of credit insurance by some providers a 'reflection' of current challenge facing IT sector, according to MD Steve Soper
SMART's UK managing director joins Lenovo to boost SMB business