News

Microsoft Corp. has spent a lot of effort making software for the small-business market, but until last week the giant software maker never saw itself as a small business.

Now it finds itself in the company of some of the largest U.S. news media companies, including The Associated Press, who had been counted last year by the U.S. government as small businesses for contracting purposes, inflating the Bush administration's record of help to small companies.

Other media companies cited as small businesses included The New York Times Co., USA Today International Corp., Bloomberg L.P. and the Public Broadcasting Service, according to data the administration gave congressional investigators.

The companies join other corporate giants like ExxonMobil that congressional investigators identified last week as companies listed as small businesses by the White House. The companies say the government erroneously gave them that designation and they did not portray themselves as small businesses to win the contracts.

The AP was cited as receiving five small business contracts valued at $31,600. Three of the contracts were awarded by the State Department, one was given by the U.S. Coast Guard and the fifth was from the Department of Transportation.

AP said the original Coast Guard contract, an $8,000 award described as a "phototechnology maintenance contract," didn't list it as a small business. AP spokeswoman Linda Wagner said the news organization couldn't find any records involving the other four contracts.

The largest AP contract, a $19,100 award for software support to the secretary of transportation, cited the news organization as a small business. Wagner said it appeared to be a government error.

"We do not believe AP has signed any government contract that specified small business status for the vendor," she said.

The AP, a not-for-profit cooperative, employs about 3,700 people in more than 240 locations around the globe. It reported 2005 revenues of $654-million.

"Since we do not categorize The New York Times as a small business, clearly this was an error," Times spokeswoman Abbe Serphos said of two General Services Administration contracts totaling $10,875 that the government reported as small business contracts.

The Times' parent company also publishes The Boston Globe, International Herald Tribune and 15 other daily newspapers. It reported $3.4-billion (U.S.) in revenue in 2005 and has about 12,500 employees.

Tara Connell, a spokeswoman for Gannett Co., the parent company of USA Today International, said records showing the subsidiary received a $12,690 small business contract from the Bureau of Indian Affairs was obviously a "clerical error."

Gannett, headquartered in McLean, Va., is the largest U.S. newspaper company. It reported $7.6-billion in operating revenue in 2005 and has 52,600 employees.

Bloomberg, which employs 8,200 people and reported annual revenues of $3.2-billion in 2005, gave a similar account. "We do not categorize ourselves as a small business nor do we represent ourselves as a small business," spokeswoman Judith Czelusniak said.

The government is required to spend 23 per cent of roughly $314-billion in contracts with small businesses. Last month, the Small Business Administration claimed the government more than met that goal in 2005.

An investigation by House Democrats found the number was closer to 22 per cent because about $12-billion in contracts to big companies were mistakenly cited as going to small businesses.

The media companies were not mentioned in the congressional report last week but were included in a database of small businesses the investigators received as part of their inquiry.