Software companies’ “smokescreen” complaint investigation dropped by CMA
29 August 2024
Education Software Solutions (“ESS”) believes that complaints from third parties, including two of its competitors, which sparked a Competition and Markets Authority (“CMA”) investigation into the process used to transfer data from ESS’ School Information Management System (“SIMS”), were vexatious and a smokescreen for the continued unlawful use of ESS’ intellectual property by these competitors.
The investigation, closed by the CMA without action against ESS, was prompted by competitors who claimed that there was no viable alternative to copying SIMS databases, containing over 1.5 million lines of ESS program code, when transferring school data from SIMS to their own systems.
For more than a decade ESS has provided a safe and authorised method to transfer data from SIMS through the SIMS Application Programming Interfaces (“APIs”). The APIs preserve the integrity of data extracted from SIMS and are widely used with over 5 billion API calls being made in an average month. Given the availability of these APIs there is no justification for ESS’ competitors copying SIMS databases or inducing ESS’ customers to do so on their behalf. ESS was and is entitled to object to the unlawful use of its intellectual property and to take action against anyone infringing its intellectual property rights.
ESS wrote to certain competitors and schools in December 2023 objecting to the unsafe and unlawful use of SIMS databases to undertake data transfers, reminding them that the APIs and the SIMS Report Generator are the only safe and ESS authorised means for extracting data from SIMS. In response a number of these competitors complained to the CMA, which began its investigation. Six months on, that investigation has been closed, with the CMA acknowledging that (as ESS had said all along) migration using the APIs is both viable, and in the CMA’s words, 'less burdensome on schools and less error prone than the options that were available to schools when ESS first objected to the use of database back-ups for the purposes of switching MIS supplier'.
Commenting on this decision, Lewis Alcraft, Group Chief Executive of ESS said:
“Certain of our competitors complained to the CMA that the SIMS APIs were too ‘complex, time consuming and error prone’ to be usable. That this was untrue is now evident from the fact that these same competitors are now using, or proposing to use, these APIs to undertake migrations, a method which in the words of the CMA is 'less burdensome on schools and less error prone than the options that were available to schools when ESS first objected to the use of database back-ups for the purposes of switching MIS supplier.' We hope that everyone now sees that these complaints were a smokescreen for the continued unlawful use of ESS’ intellectual property.”
ESS is considering what action should be taken regarding any misuse of its intellectual property now that the CMA’s investigation has been closed. ESS has no wish to impede schools from switching to alternative suppliers provided this is done lawfully. To that end, ESS calls upon any school that intends to transfer data to a new supplier not to be persuaded into handing over backup copies of the SIMS database as part of this exercise, noting that to do so would be a breach of the school’s licensing agreement with ESS. Schools should instead insist that any new supplier uses the SIMS APIs.
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