In one of the single biggest office software deals in the world, Sun Microsystems has sold 10,000 user licences of its Star Office productivity suite to United India Insurance. The deal is valued at Rs 2 crore (Rs 20 million).

Sun outsmarted software giant Microsoft in the bargain for the deal. A similar big order in the past by Oil and Natural Gas Corporation for about 8,000 odd user licences was won by Microsoft.

Based on open standards, Star Office offers word processing, spreadsheet, presentation, drawing and database capabilities.

The deal will see United India install the office productivity software across 1,100 operating offices and 24 regional offices in the country.

Senior Sun executives refused to comment. United India officials confirmed the deal and said the company expected to roll out the entire package across its offices next month.

"We were using a restricted licence of Microsoft Office and we were anxious that we would not be able to enforce the licence norms. But now that a corporate licence agreement with Sun is done, we don't need to worry," a senior official of the insurance firm said.

Sun had globally launched its latest version of Star Office only a month ago.

Sun is believed to have quoted lower prices to clinch the deal. Star Office is priced at $75 per unit and in the Indian market it retails at around Rs 4,500 for a single user. The Microsoft office package is sold at Rs 13,000- plus for a single user.

"Being a public sector unit, we had invited tenders and to make a match of it we needed at least three bidders. On two occasions, we had only two bidders. It was only the third time that there were four bidders and we chose Sun Microsystems," said a United India official.

Sun was represented in the deal by Chennai-based Accel ICIM, a Rs 200 crore (Rs 2 billion) system integration and software solutions provider.

Sun has gained only 10 per cent of the office productivity segment in India so far, while the leader continues to be Microsoft, according to the Asia Computer magazine.

The domestic demand for office suite is estimated at a range of 100,000 to 120,000 units per annum.