NHS IT adviser Connecting for Health has informed other NHS organisations that there will be no new deal for Microsoft applications. The contract, estimated to be worth £500m, was due for renewal after running for 12 years.
NHS trusts will still have the right to use existing software, but they will have to negotiate their own terms with the US software giant in order to gain access to updates and future releases.
Up to 850,000 NHS users were covered by the deal, with some analysts questioning the need for every member of staff to have access to the full Microsoft suite of applications.
The now-terminated contract also enabled NHS staff to purchase Microsoft software for home use at minimal cost. This facility expired with the wider licensing deal.
Health secretary Andrew Lansley's Liberating the NHS white paper promised that NHS organisations would increasingly become "customers of a more plural system of IT and other suppliers". The termination of the Microsoft deal reflects this change.