OFT investigates if competition is stifled in public IT space
Government body launches consultation to see if SMBs are locked out and users restricted by big boys' tactics
The Office of Fair Trading (OFT) has announced it is to investigate the public sector ICT supply market with a view to discovering whether or not there is a damaging lack of competitiveness.
The non-ministerial government department is appealing for suppliers and public sector users to provide details and thoughts on their experiences. The OFT hopes to find out more about the number of providers working in the market and how much market share the major players hold. Also to be examined are potential barriers to entry for SMBs and whether users face too many restrictions when attempting to switch suppliers.
The investigation is also seeking to ascertain whether some suppliers deliberately limit interoperability with competitors' systems, and whether the use of outsourcing means public bodies become too reliant on external expertise, compromising their ability to drive savings and efficiencies.
A statement issued by the OFT today explained that "healthy competition in any market drives down costs, drives up efficiency and promotes innovation, while a lack of competition can hinder productivity and, in turn, economic growth". The statement stresses the importance of the ICT market by pointing out that the top 20 suppliers of technology products and services receive about £10.4bn of government cash each year.
"ICT is a crucial part of any modern economy and is key to improving productivity in public services as well as businesses," said OFT chief executive Clive Maxwell. "Given the vital role that this technology plays in the delivery of public services and the cost to the taxpayer, the OFT believes it is important to explore whether there are any restrictions on competition.
"We want to hear both from industry suppliers and public sector users about how competition in this market works, any problems that they have experienced, and how it could be made to work better."