Deal actually saves U.K. government about $40 million, says negotiator

How much is the price of failing to get off Windows XP on time?

That would be £5.548 million or roughly $10 million if you happen to be the government of the United Kingdom.

The government signed an agreement with Microsoft Corp. to provide XP support and security updates to the UK public sector for 12 months after Redmond globally cuts support for the much loved operating system on April 8.

The £5.548 million deal, according to the U.K. daily the Telegraph, includes “critical” and “important” security updates for XP, Office 2003 and Exchange 2003.

The agreement “will provide continuity” for government and public sector organizations still using XP “while they migrate on to alternative operating systems,” said Rob Wilmot, crown representative for software of the Crown Commercial Service (CCS) which negotiated the deal.

The plan is still just a stop-gap measure, since the government will still have to shell out more money for a new OS eventually.

The CSS claims the agreement saved the government more than $40 million, compared with individual departments negotiating their own deals.

Microsoft charges $200 per desktop for a year’s custom support for Windows XP. This suggests that the U.K. public sector has around 200,000 computers still using the OS, according to the Telegraph.

Of course all this could have been avoided had U.K.’s public sector offices converted to Windows 7 or Windows 8 before the April 8 deadline.

Windows XP was released in 2001 and Microsoft had tried several times to wean away users from it with the introduction other operating systems such as Vista, Windows 7 and Windows 8. The company for announced the end-of-support date for XP in 2007.’

The U.K. is not the only government in an XP bind.

An estimated 72.1 per cent of all computers in China are believed to still be running XP. However, Microsoft has partnered with Chinese microblogging site Sina Weibo, to keep XP alive in China.

Web analytics firm Net Applications estimates that 37.2 per cent of the world’s PC or about 570 million machines are still running the 12-year-old OS.

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