Microsoft has issued letters to 650 US local government authorities, asking them to conduct "voluntary software audits", according to information obtained by LinuxWorld.com

The letters appear to form part of a campaign to persuade municipalities in America to adopt easy-to-adminster enterprise licensing contracts, which also work out much cheaper per person than purchasing ad hoc.

As well as the carrot, Microsoft is carrying a big stick - the threat of penalties, in effect enormous fines - to municipalties that have failed to keep proper account of their licence obligations to the company.

According to Joe Barr, the estimable columnist of LinuxWorld.com, rumours were floating around his local haunt, Austin, Texas that this one city faced 'fines' of up to $15m for failing to comply with Microsoft's license fees.

In a memo sent to Barr, Austin chief information officer Brownlee Bowmer denied that the city had been fined by Microsoft or that it had been audited by the company. He confirmed that the City was negotiating a multi-year enterprising licensing agreement with Microsoft.

A win-win situation? Not exactly, Barr points out. MS enterprise licensing still works out expensive - there's no scope for downsizing, and it, in effect, locks out competitive technologies, he argues. Also he warns organisations to keep all their paperwork related to MS purchases. If you can't prove you've bought the software, you could end up paying for it twice.

You can follow Barr's arguments in full atLinuxWorld.com. ®