The country’s largest school information management systems (SIMS) software provider is facing a fresh investigation by the Competition and Markets Authority (CMA) over ”potential abuse of dominance” following complaints from schools.
The watchdog says it suspects that Education Software Solutions (ESS) may have been trying to retain customers by making it difficult for them to switch providers ahead of contract renewal dates.
The CMA said it is “urgently” investigating reports that ESS had warned schools that they would not be able to share a copy of their database with a new provider, as doing so would breach ESS’s intellectual property rights.
The CMA said that it understands that “sharing database backup copies is a longstanding and widespread practice used in the sector for data transfers of this kind”.
Without it, the watchdog is concerned that “schools’ ability to move to a new provider would be severely hampered”.
SIMS switches ‘complex’ for schools
Although switching providers is permitted by the company, schools have told the CMA that these switches are “complex”, “time consuming” and “error prone”.
ESS is the largest provider of SIMS in the UK, the CMA has said, adding that it has around a 50 per cent share of the market in England.
The latest CMA probe comes after a separate inquiry in 2022 in which ESS was investigated after concerns that the company had used its dominant position to push a contract change on schools.
The investigation announced today follows schools and competitors complaining that ESS had objected to the alternative solutions being put forward to enable the extraction of their data.
The CMA will be investigating ESS to determine whether or not the law has been breached. If the allegations against ESS are found to be true, the company could be in breach of competition law, the CMA has said.
Juliette Enser, the CMA’s interim executive director of competition enforcement, said: “We’re concerned about the complaints we’ve received regarding ESS’s alleged behaviour. As such, we’ll be investigating their conduct with urgency to get to the bottom of the matter.
“Management information systems are an integral part of protecting schools’ data, reducing costs and safeguarding students. It’s essential that schools are able to pick the most appropriate system for their needs - and change providers with ease when their contract is up.”
ESS said: “We are extremely surprised at this sudden announcement by the CMA, which overlooks the fact that there are legitimate methods of migrating data from SIMS to the systems provided by our competitors.
“That some competitors have chosen to ignore these methods and have instead created a ‘workaround’ that accesses our core code is the only abuse in this situation.”
In 2022, ESS offered the CMA commitments following a review to determine whether the company was using its dominant position in the market to push schools into accepting new three-year contracts, where previously they had run for just one year.
The CMA said this allowed eligible schools to exit early from their three-year contract.
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