Germany: License costs for Microsoft at a high level, overall new record

Originally, Federal Finance Minister Christian Lindner (FDP) wanted to prevent the public from gaining an insight into the constantly rising costs of the federal administration for software licenses and IT services such as consulting, maintenance and cloud or server services this year. However, following protests, Member of Parliament Victor Perli from the parliamentary group "Die Linke" is now allowed to make the figures public. According to an overview provided by heise online, all federal government departments spent more than one billion euros on the use of licenses for computer programs and IT services for the first time in 2023: The relevant fees have risen from around 771 million euros in 2022 to over 1.2 billion in 2023. This corresponds to an increase of 441 million euros or around 57 percent.

Perli has been asking the executive branch about the costs, which are rising massively every year, since 2018. His focus is primarily on Microsoft, after EU experts warned back in 2017 that dependence on the software giant's products was jeopardizing digital sovereignty. In 2019, auditors referred to "pain points in the federal administration" in a study. The traffic light coalition has resolved: "Development contracts are generally commissioned as open source." According to the current overview, the costs for Microsoft licenses remain high at 197.7 million euros. In 2022, they were still around 209 million euros, which indicates a slight decrease.

However, Perli emphasizes that the Federal Ministry of the Interior (BMI), the Ministry of the Environment and Consumer Protection and the Chancellery provided incomplete information. The figures for 2023 and 2022 are therefore not directly comparable. Even based on the figures provided, Microsoft costs have risen sharply by more than 250% since 2017, when they amounted to 74 million euros. The Federal Ministry of Defense (BMVg) remains the frontrunner here with just over 95 million euros and the BMI with just under 43 million euros. They are followed by the Federal Ministry of Finance (BMF) with over 23 million euros. Of the almost 198 million for Microsoft, 98.5 million is attributable to perpetual licenses, 29 million to subscription models and 69 million to "other services or products".

Perli: Further price shocks loom

Above all, however, expenditure on software licenses from providers other than Microsoft has shot up. In the 2022 financial year, the federal government spent around 562 million euros on this. In 2023, it was almost twice as much at just over one billion euros. The biggest cost drivers here are also the BMVg, the BMI and the BMF. The table does not reveal which software manufacturers or service providers are involved.

Lindner initially classified the expenditure as "classified information - for official use only". Perli then accused him of wanting to protect Microsoft and "not the common good". The statistics had regularly "supported debates on open source software and - as I know from conversations - also raised awareness of the problem in the ministries". The FDP, under its party leader Lindner, has also been sponsored by Microsoft. The BMF finally upheld the opposition politician's complaint in part.

In terms of content, Perli is not satisfied with the result. The high expenditure should "alarm all those responsible", explained the parliamentarian. The traffic light coalition is "not getting a grip on the exploding costs". The federal budget had "become a money-printing machine for software companies". After Microsoft in particular had been able to drive up prices for years and "shamelessly exploit its monopoly position, other companies have now followed suit". The government alliance has still not introduced a system for managing expensive IT licenses, complains Perli. Germany and Europe must become less dependent on big tech companies; otherwise, there is a risk of further price shocks and data misuse. The government should provide alternatives for the planned administration cloud. It is important to prevent "Microsoft's involvement from leading to horrendous costs again".

(bme)