The NSW Department of Education has put Microsoft on notice after it agreed to extend its software licensing agreement with the company for just one year instead of renegotiating a new three-year contract.
At the same time, technology chief Stephen Wilson announced the department will install a free alternative to Microsoft's Office suite, referred to in industry circles as OpenOffice, on 41,000 computers due to be distributed to schools across the state by the end of 2008.
"For the first time we're going to install OpenOffice on every computer under our Technology 4 Learning programme," he says.
One of the nation's biggest users of personal computers, the NSW Department of Education is also resisting Microsoft's attempts to upgrade users to the latest version of its Vista operating system.
Instead, Wilson's team is downgrading every new computer it buys from Vista to Windows XP. This incurred an additional expense in the short term, he says, but was less expensive over the life of the computer.
The move is less a backlash against Microsoft and more recognition that the purchasing model for software in educational institutions is changing.
"We can see a shift in requirement to more online creation and multimedia," Wilson says.
"Many of the things, particularly through our A$158 million Connected Classrooms programme, are going to be delivered online rather than through a gigabyte of installed software on your hard disk."
This new model of online software delivery and data storage, pioneered by Hotmail, Google and Facebook, paves the way for new players in a series of education tenders under negotiation.
The tenders, include a new email system and an expression of interest due this month for personal computing devices with a A$500 price tag.
"There is a whole new generation of technology that's coming along which will break the conventional total cost of ownership that has made a 1:1 ratio of computers to students unaffordable in the past," Wilson says.
The market witnessed the beginning of this trend last year when ASUS' A$499 Eee PC laptop, targeted at kids and students, sold out within hours of hitting shelves in Myer stores across Australia.
If Wilson is correct, the NSW government may have unearthed the silver bullet to cover the gaping hole in education minister Julia Gillard's education revolution scheme.
Launched during the election campaign, the Rudd government promised a laptop for every school student in years 9 to 12, at a cost of A$1 billion over four years. The first A$100 million is due to be handed out by June 30 to schools with a student-to-computer ratio of 8:1 or less.
However, educators have warned of a gaping hole in the plan, with states and parents forced to pay for teacher training and infrastructure.
The opposition suggests that for every dollar spent on the laptop itself, another A$3 is required for associated software, training, networks, technical support and security.
A spokeswoman for Gillard said last week the federal government was budgeting A$1000 per computer but it expected schools to be able to purchase PCs and laptops for less than that, leaving money over to pay for support services.
— Australian Financial Review