HP-owned EDS has won the bulk of a three-year application development and maintenance outsourcing deal with Australia's number two telco, Optus.
The deal puts an end to IBM's stake in Optus' application services and maintenance work, which could have been worth up to $500 million under a 10-year deal inked in 2002. IBM's work had also included maintenance of Optus' IT systems, including customer care, billing and enterprise resource planning (ERP).
It is not clear whether IBM will continue to work for Optus.
An Optus spokesperson declined to confirm the value of the contract with EDS; however, it has been reported in the Australian Financial Review that the deal is thought to be worth $150 million over three years.
A secondary winner under Optus' application outsourcing contract, which commenced in April, was Accenture. Mahindra Satyam, local IT integrators NCS and Optus' parent SingTel also provide application maintenance work. Accenture and EDS will provide broad application support, while the latter three support specific applications, an Optus spokesperson told ZDNet.com.au.
"While Accenture and EDS have previously provided application maintenance and support services to Optus, the new agreement represents a significant increase in our relationship with EDS in particular," Optus chief information officer, Lawrie Turner said in a statement.
Turner said it was the rationalisation of suppliers that will lead to savings. "Although application support and maintenance services are already provided to Optus on an outsourced basis, we expect to make substantial savings by rationalising the number of suppliers we work with from over 20 today to five going forward, as a result of these new agreements," said Turner.
IBM and EDS have another telco battle ahead as newly merged mobile telco VHA (Vodafone Hutchison Australia) moves to merge its Vodafone and 3 Mobile back-office operations. Information technology outsourcing suppliers are also likely to be consolidated, with some analysts expecting Vodafone's line up to be retained.
Vodafone's seven-year application maintenance contracts with EDS and IBM are expected to end this year. Hutchison's application maintenance provider is Indian company Tata Consultancy Services, while Western Australian ASG provides desktop support.
EDS have won the business but in times of recession are going to send the jobs OS. Australians who are employed now doing the work looking after these applications, many working for HP, will have their own jobs outsourced to HP India (HP GDAS)! This is what HP are doing with Australian jobs - sending them OS. They are shafting their own workers and outsourcing their own people from HP Australia to HP India. If you use Optus for your services, be ready, because a LOT of the local experts will loose their jobs in the next few months and the work will be done in India. This is what HP are doing to their own people. Still wanna buy HP products? I don't.