U.K. health agency taps Oracle as database vendor

Britain's National Health Service has also opened talks with Microsoft

Britain's National Health Service (NHS) has selected Oracle Corp. to be its enterprisewide database provider for a new nationwide IT project covering 50 million patients. And it has begun discussions with Microsoft Corp. Chief Software Architect Bill Gates on a similar licensing deal for Microsoft products, according to British news reports.

Ben Payne, a spokesman for the NHS IT program office, confirmed that Gates met with U.K. Health Secretary John Reid and NHS IT Director General Richard Granger on Monday, but he couldn't provide details about the meeting.

David Lubinski, managing director for health care at Microsoft, said his company is working with the U.K. government to address its IT needs in a way that delivers value.

Lubinski also said Microsoft is committed to helping governments and local regions develop sustainable IT infrastructures that are easy to use, innovative, offer a clear road map for future development and access to source code to improve security and implementation.

In addition to tapping Oracle, the NHS National IT Program also awarded a $1.6 billion contract yesterday to Fujitsu Alliance to act as the local service provider in the south of England. Fujitsu Alliance will provide the IT infrastructure for 13 million patients and 256,000 health care workers. That decision completes a series of IT infrastructure contracts worth a total of $9.6 billion that NHS has awarded since Dec. 8.

Fujitsu Alliance consists of the London-based Fujitsu Services division of Fujitsu Ltd., which is the prime contractor; Burlington, Vt.-based IDX Systems Corp., which will provide core clinical applications; Tata Consultancy Services, a division of Tata Group Ltd in Mumbai, India, which will handle clinical application deployment; PricewaterhouseCoopers LLP in New York, which will be responsible for security and training; and London-based BT Group PLC, which will handle systems integration.

Neither Oracle nor the NHS IT program office would provide financial details of their contract, but the NHS did say in a statement that the agreement would save the agency $182 million over its 10-year life. "This deal will help ensure that all clinicians benefit from the technology that Oracle provides, including access to vital patient information with a far higher degree of resilience and reliability than is currently achieved," Granger said in a statement.

The NHS estimated that the Oracle database would support 5 billion transactions a year by 2008 and that when the agency completes its IT infrastructure upgrade, the new system will provide electronic health records for 50 million patients, accessible by 30,000 doctors.

An Oracle spokeswoman in Britain said the NHS can choose either the company's older 9i database or the10g database, introduced last December.

The NHS has no intention of stopping with Oracle in its quest for low-cost, enterprisewide licensing agreements. The agency said "negotiations on financially efficient NHS-wide agreements are being concluded with a number of IT suppliers."

The NHS IT program began putting pressure on Microsoft last month when it signed an agreement with Sun Microsystems Inc. to evaluate the use of Sun's Java Desktop System throughout the NHS.

At that time, Granger said that the Java Desktop System "holds the promise of allowing a greater share of NHS funding to flow directly towards improved levels of patient service. Sun's innovation and flexible approach to addressing the business challenges of the NHS are an example ... we would encourage all IT vendors to note. If this solution were to prove effective, we could save the NHS and the taxpayer many millions of pounds whilst at the same time using rich and innovative software technology."

Gartner Inc. in a report issued Jan. 22 said Microsoft is "at serious risk of further alienating many of its customers with respect to its licensing terms and conditions." The report added that many enterprise customers are increasingly "questioning the value" of Microsoft's Licensing 6.0 Software Assurance program.

The report said that while the Software Assurance program doesn't guarantee new products under the three-year license, most enterprises expected to get some return on their investment, which is now questionable due to "elongated" release schedules for new Microsoft products.

Copyright © 2004 IDG Communications, Inc.

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