Google Loses Government Contract to Microsoft, Sues US Dept. of Interior

In the latest round of “sue, sue, I sue you,” Google (News - Alert) filed a lawsuit Friday against the U.S. Department of the Interior. At issue is the Interior’s decision to purchase Microsoft e-mail and collaboration software for 88,000 employees, apparently without seriously considering similar products from other companies.

Google claims that the Interior Department’s request for quotes (RFQ) process for selecting a communications solution was unduly restrictive of competition because it required that the system be integrated with Microsoft (News - Alert) Business Productivity Online Suite.

In the RFQ, Google claims, “the DOI restricted the candidates to using the Microsoft suite only,” Ars Technica reporter Casey Johnston said in a Monday report. “The problem is that such a restriction is akin to putting money directly in Microsoft's pocket, as the contract can't be completed without Microsoft taking part at some point.”

The Interior Department’s defense, according to Google’s 37-page filing, is that the Microsoft suite provides features, including consolidated e-mail and enhanced security, not available from other vendors. Google countered this claim by saying Microsoft’s products suffer from downtime issues and Google Apps are a suitable alternative, Johnston reported.

Google claims that the Interior Department’s RFQ process violates the Competition Contracting Act, the New York Times said. As a result, Google was shut out of a contract worth $59.3 million.

Google claims that it’s not filing the lawsuit solely for its own benefit, but also to potentially save Americans money, Washington Post reporter Cecilia Kang noted Monday.

“Here, a fair and open process could save U.S. taxpayers tens of millions of dollars and result in better services,” the Washington Post report quoted a Google spokesperson as saying. “We’re asking the Department of Interior to allow for a true competition when selecting its technology providers.”

On balance, it would seem that Google comes out ahead in its arguments, but for one thing: the company, which began hawking its wares to the Interior Department back in 2009, didn’t obtain accreditation necessary to be considered an interested party until this past July.

Whether or not the accreditation issue ends up being Google’s Achilles’ heel, remains to be seen. Stay tuned.