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The National Interest and the Microsoft Defense Contract

The Fall of France

by EVAN JONES

In 2006 French author Max Gallo penned a potboiler called Fier d’être français (Proud to be French). Out with the omnipresent naysayers, said Gallo. The Glory of France remains regnant, and it demands to be celebrated. For his pains, Gallo was soon elevated to the hallowed 40-member French Academy.

But 2007 also ushered in the Presidencies of Nicholas Sarkozy and then of François Hollande. It’s a long descent from the Sun King, Napoleon and de Gaulle to Sarkozy and Hollande. La gloire is now a concept best left to historians.

The Sarkozy years, a banana plutocracy, were marked by corruption and buffoonery. Hollande campaigned as ‘Mr Normal’, but the electorate got Mr sub-Normal instead. Hollande’s administration is marked by cowardice and myopia. Overseas, Hollande sucks up to the rogue state du jour (Qatar, Israel, Saudi Arabia; now the US?), and plays Rambo in Africa. Domestically, his neoliberal agenda is extinguishing the last flicker of the socialist spirit from his Parti Socialiste. Brussels and Berlin are beyond his ken.

France’s fall from the top shelf of nations might be more deeply rooted than the peccadilloes of its President mediocrities. The Defense Department’s pursuit of its computer software needs provides an exemplary case in point.

On 25 May 2009, the French Defense Department’s operational IT arm DIRISI signed a contract with Microsoft. The contract aroused consternation then and it arouses consternation still. The story comes courtesy of the ferrets at Le Canard Enchainé and Mediapart and from Open Source software sites.

The contract ushered in Microsoft as the sole software supplier to the entire Defense complex, at a cost of €100 per pc, summing to almost €19 million per annum. The process was not subject to tender.

In 2007, Defense was in the process of centralizing software organization, with the intention of rationalizing an extant fragmented procurement process. In June (a month after the installation of Nicholas Sarkozy as President and immediately after his Parliamentary victory) the Defense managerial IT arm DGSIC issued a document ‘Guidelines for establishing partnerships with software companies’, which laid out the benefits of a privileged relationship with Microsoft. But it also acknowledged the potential ‘profound state of dependence’ that might ensue, recommending a risk analysis of various scenarios.

A Steering Committee of Defense heavies was established which in turn established a committee of experts (from within the military) to examine the issue. The expert committee reported in January/February 2008, in alarm. The report (Analyse de la valeur du projet de contrat-cadre avec la société Microsoft) highlighted the constraints on the Ministry in putting its entire information system network under a single structure and that owned by a private corporation. More (s5.5.2), under ‘Loss of national sovereignty (control by a foreign power)’, it notes:

“The ensemble of these American products must obtain the backing of the NSA to be exported. The NSA has systematically introduced ‘backdoors’ into software. A system depending predominantly on US products like Microsoft will be vulnerable by being susceptible to NSA intrusion in its totality.”

The report concluded (s7.5): “The [package deal] offer made by Microsoft constitutes the most risky scenario. … [To pursue] this scenario is strongly inadvisable.”

The Steering Committee heavies immediately derided and over-ruled the expert report, advising that ‘in order to comply with ministerial guidelines’ the contract with Microsoft should be pursued. The Director of DGSIC then wrote to the Defense Chief of Staff in May 2008, sending a redacted summary of the risk analysis, requesting authority for the Microsoft contract (termed ‘Open Bar’).

But the public procurement commission (the then Commission des marchés publics de l’État) CMPE was brought in of necessity. Concerns expressed in its April/May 2008 report include:

“Microsoft has already been condemned in 2004 by the European Court of Justice for ‘abuse of dominant position’, confirmed on appeal and which carried the heavy fine of €899 million. The Court is currently presiding over two other complaints, begun in February 2006 [concerning inter-operability of competitor software on Microsoft Office]. … Microsoft Office software is at the heart of the proposed contract.”

“[Inter-operability of competitor software is fundamental to user flexibility and discretion.] The proposed contract does not mention the term ‘inter-operability’. [The trend in French public administration is towards open source software, most notably in the national Gendarmerie, where the migration has been completed. Moreover, the character of the contract runs counter to a number of official edicts since 2005.]”

The report infers that the open-ended nature of the contract is designed to tie Defense indefinitely to Microsoft. This fusion would expose Defense to falling foul of favouritism proscriptions, and the state to perennial expense for updated versions of the software. It is clearly Microsoft’s intention that Defense be tied indefinitely to products subject to myriad Microsoft patents, and which prevent any use of or transition to open source software.

The report acknowledges the trend towards centralization of public procurement to achieve scale economies, but notes that there thus ensues distance between the procurer and any particular user group, with the potential that the user group’s specific needs will not be investigated or accommodated, and dsyfunctionality will become entrenched. No analysis of the benefits and costs of centralized procurement in Defense has taken place. The major beneficiary of centralized procurement will be the software provider itself which will dictate the ‘needs’ of a multitude of users.

The report claims that Microsoft’s dominance is precisely why a contract without open tender is inappropriate. A closed negotiation process also allows Microsoft to remain opaque on important matters of detail, not least costs.

More, Microsoft Ireland will be the beneficiary of royalties generated from the licenses at the root of the proposed contract. What? Of which more below.

The 22 page report concludes with an ‘apology’ by the author/s for being so uncomfortable with their discoveries and concerns. In a six point summary of concerns in a language of calculated diplomacy, the authors effectively label the proposed contract with Microsoft a disgrace and a worry. For example:

“The present affair is only the visible part of the relationship between the French public sector and Microsoft, a relationship in which the political stakes are extremely contentious, marked by the economic and financial power of Microsoft.”

The situation, concludes the report, is further hampered by the absence of an overall industry policy framework by which the Microsoft/Defense proposal could be contextualized and judged.

The public interest has been bulldozed. Get in somebody with authority, says the report, who knows what they’re doing and clean up the mess; and, above all, mandate, inter-operability of competitor’s software into the contract.

Another strongly dissenting report, another report ignored. Thus the May 2009 signing.

In February 2010 the francophone open source software advocate AFUL wrote to several Parliamentarians regretting the Defense/Microsoft contract. It noted that previous research and experimentation with open source software was threatened with termination. More, Microsoft had become embedded, via a ‘Microsoft Centre of Competence’, in the heart of DISIRI at Fort de Bicêtre.

AFUL was appalled that a private company should have “an exhaustive vision of the structure and geography of the organization of our defense, and complete access to the different information systems and to the administration of data being processed.” No reply from the Parliamentarians nor the Ministry was forthcoming.

In April 2010, the matter was publicized by Le Monde, generating questions from a Deputy. Sarkozy’s then Defense Minister, Hervé Morin, replied in June that the process had been “examined by the CMPE which has given advice favourable to the signing of this contract”. A transparent porky.

As noted, DIRISI signed the 2009 contract with the imperialist and imperious Microsoft in Dublin. The lucrative contract with a significant arm of the state was thus to be a vehicle for evading tax payable to the fisc. Microsoft’s considerable edifice in the Paris suburb of Villejuifs is apparently only a glassy facade – no activity generating profits takes place there. Ah, the ignominy of it all. France’s fiscal Waterloo.

Strange then that in May 2011 the French tax authorities were pursuing routine inspections of the casino operator Partouche. They stumble across bills involving work for Partouche in France by Microsoft France but billed to Ireland or the U.S. The inspectors wonder if the procedures observed at Partouche might be more generalized in the Hexagon. Do wild bears shit in the woods?

Thus there is belatedly in June 2012 a sizeable raid by the tax inspectors on Villejuifs. The Finance Ministry is since trying to recover some of Microsoft France’s hard-earned, while ignoring the leakage associated with the Defense contract. Such are the silos in French administration.

Meanwhile, in mid-April 2013 Le Canard Enchainé highlighted that General Patrick Bazin had called for the renewal of the Microsoft contract – on the grounds of ensuring inter-operability amongst allies (read NATO). Sarkozy had announced in June 2008 that France intended to re-join NATO’s command structure, a decision implemented in April 2009 (a month before the signing of the Defense/Microsoft contract).

The minor Union Populaire Républicaine Party (anti-European Union, anti-NATO) naturally was appalled. Its spokespersons claimed that an NSA Director had disclosed publically in November 2009 that NSA had participated in the development of Microsoft’s Windows 7.

“To utilise the Microsoft operating system at the breast of the Defense Ministry permits NSA to read as an open book our defense strategy and eventually to oppose a sovereign action of France. Given the domination that the American Empire exercises on the West, this decision effectively constitutes wilful submission, and we’re paying for the privilege to boot.”

“To top it off, Windows is the system the most susceptible to virus attacks. Let us recall that part of France’s air naval arm was incapacitated in [January] 2009.”

They even accuse the President of failing to uphold the Constitution (vide Art.5: ‘[The President] is the guarantor of national independence …’). Treasonous?

If more sober, the French open source advocate and activist organisation, APRIL, has been more persistent. It went in pursuit of documents relating to the 2009 contract. How, at a time of budgetary austerity, could the Defense Ministry fatten Microsoft when comparable software is available free, and security is more assured?

What documents were produced were heavily censored. But Le Canard had some originals and the censor clearly understood what was at stake. Everything of significance was blacked out.

In October 2013, Hollande’s Defense Minister Jean-Yves Le Drian secretly renewed the Microsoft contract. Upon belated discovery of this fact, APRIL again requested relevant documents in December. Back came documents again blacked out for all essential details.

Changed administration, same dissembling – claiming due process when the opposite has been the case. Some important snippets have come out. An internal memo as early as July 2012 discloses an agenda to renew the Microsoft contract, ignorantly attempting to discredit open source options. The new contract has had the approval of the Ministry of the Prime Minister, in spite of a Prime Ministerial directive to all departments in September 2012 to investigate open source alternatives. And the renewed contract’s coverage has been extended to services external to the Defense Ministry, increasing the work stations under contract from 185,000 to 200,000. The financial arrangements remain secret.

APRIL derides Defense’s claims that it had to ensure compatibility with NATO’s allies. APRIL notes that ‘inter-operability’ does not refer to acquiescence to a sole software provider but to the capacity to function with an ensemble of systems. More, APRIL notes that NATO itself does not impose Microsoft on member states; on the contrary.

In an article on Mediapart in December 2013 APRIL’s president Lionel Allorge claims:

“We are particularly shocked by the Defense/Microsoft contract, renewed without tender, delivering the Defense Minister bound hand and feet to American interests. … It appears so much more shocking as the administration has at the same time confirmed a system of global espionage of which our country and our citizens are victims. … It is a question here of the protection of fundamental principles of our Republic – its technological independence and of the preservation of its strategic, economic and intellectual interests.”

It is of more than passing interest that Brussels itself is in the same boat as the French Defense Ministry. The same acquiescence, the same obfuscation in defense, the same hypocrisy.

Brussels’ contract with Microsoft was established in 1993, and has been renewed six times without tender. Thus in November 2013 a hacker broke into the European Parliament’s email system. He did it, he claimed, as a political act and to show how easy it was. The Brussels establishment remains unmoved in spite of pressure from some European Deputies.

The hypocrisy dimension is well captured by Mediapart’s Jérôme Hourdeaux:

“This quasi-monopoly of Microsoft is so much more strange given that [Brussels has] not ceased to praise the virtues of competition and the necessity of transparent public market processes, but also the merits of open source software.”

An insider to the process in France has lamented:

“One thing is certain – the experts have been insufficiently heard. I am a military person. And I must say that I am not very proud of my country. I could have been able to accept many things if explanations had been forthcoming. But we have never had an explanation. The banner under which we struggle, and for which some of us have spilt their blood, is Liberty, Equality, Fraternity. In this affair we have sold short our liberty, we have betrayed our country. And to date, I am incapable of understanding why …”

Where are you M. Gallo? Your country needs you.

Evan Jones is a retired political economist from the University of Sydney. He can be reached at:evan.jones@sydney.edu.au