Telstra confirms outsourcing contracts

TELSTRA has awarded $1.2 billion worth of new outsourcing contracts after the telco unveiled EDS, Infosys and IBM as the survivors of its IT partners roster rationalization.  Telstra has been reviewing its IT outsourcing contracts since last year, when the telco announced it would trim its list of major IT suppliers from four to two in an effort to reduce costs and streamline providers.

Previously, Telstra’s application development and maintenance contracts were held by Satyam, EDS, IBM GS and Infosys.

In March The Australian revealed the telco had dumped scandal-ridden outsourcer Satyam from its applications support contract, believed to be worth $32 million a year, and replaced it with EDS.

The Australian also revealed that Telstra had favored Infosys over IBM for its multimillion-dollar applications support contract.

Telstra today confirmed that EDS and Infosys will pick up application development and maintenance contracts worth a combined $450 million over the next five years, while IBM will remain a strategic partner in this area.

While losing out on its software and legacy applications support work, IBM has won a renewed IT Operations Services Agreement to manage the telco’s infrastructure.

This contract is worth an estimated $745 million over five years, and will see IBM maintain datacentre mainframe operations.

Telstra chief information officer John McInerney said the new agreements would deliver significant benefits to the telco’s transformation program.

“This is an important milestone for Telstra IT ," he said. "One of the key outcomes of our IT transformation is the delivery of operational excellence.

"These consolidated contracts contribute to our strategy and ensure an ongoing investment with our key partners.”

Source: http://www.australianit.news.com.au/story/0,24897,25609583-15306,00.html