CMA investigates education software firm over potential abuse of dominance

May 15, 2024

The CMA is investigating whether Education Software Solutions (ESS) might be abusing a dominant position in the supply of management information systems (MIS) software by making it difficult for schools to switch provider.

MIS are important databases used to handle student information, such as attendance and safeguarding, and most UK schools are required to have these databases in place. ESS is the largest provider of these systems in the UK, with approximately a 50% share of the market in England, and higher in Wales and Northern Ireland.

The CMA has received complaints from some of ESS’s customer schools suggesting the firm is making it difficult for them to switch to a new provider.

The schools reported they had been warned by ESS 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 understands that sharing database back-up copies is a longstanding and widespread practice used in the sector for data transfer of this kind and, without it, the CMA is concerned that schools’ ability to move to a new provider would be severely hampered.

ESS does permit some means of switching, but these are reportedly complex, time consuming and error prone. Moreover, schools and competitors reported that ESS had objected to the alternative solutions put forward to enable the extraction of their data.

The CMA will be investigating ESS to determine whether the law has been breached. As part of this, the CMA will consider whether it needs to impose interim measures to prevent harm from occurring while it carries out its investigation. If the allegations against ESS are found to be true, such behaviour could be a breach of competition law.

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 binding commitments enabled eligible schools to exit early from their three-year contract, and the CMA continues to monitor ESS’s compliance with these commitments. The CMA’s new concerns in relation to ESS’s conduct focus on a different possible abuse of dominance and consequently are the subject of a separate investigation.