Newcastle channel steels itself for change

Newcastle channel steels itself for change

The final chapter in the history of steel-making in Newcastle ended last week but the local IT channel typifies the indomitable spirit being displayed in Australia's seventh-largest city.

As BHP closed its steel plant, Newcastle businesspeople contacted by ARN collectively breathed a sigh of relief and indicated their resolve to get on with carving out a share of the emerging alternatives and diverse market opportunities.

Tye Sharpe, an "in-your-face" general manager, sales and marketing, for the region's biggest IT reseller, Computer Systems (Australia), said that over the last 18 months, the company had gone from 48 to 73 staff.

This had occurred during a time when the city not only suffered the loss of steel-making but also centralisation (from Canberra) of defence purchasing.

According to Sharpe, the loss of industry has not hit CSA as much as others in the IT channel because of its policy of diversification. "Part of the strategy was to coordinate the marketing functions and become more customer-focused in the context of [information] technology," Sharpe said.

Rather than lamenting the lost hardware sales opportunities that BHP, the Department of Defence and other organisations represented, he referred to hardware sales as now being "part of a service-based contract". He added that, like the whole region, CSA's focus was now on emerging industries such as tourism and hospitality.

Peter Phillis, business manager for Advanced Computer Services (ACS), described the historical events of last week as "the opportunity to break free of the industrial tag and introduce and promote cleaner industries such as eco-tourism and even IT manufacturing, similar to what occurred in Wales over recent years".

Phillis claimed that the Newcastle business community had been well-briefed by BHP and that, for an IT reseller, the changing structure of the local economy has meant diversification. "While ACS has a mix of consumer and corporate customers, since the developments of the early '90s, there have been significant changes to the business including better management systems and procedures," he said.

For Phillis, last week's BHP closure was another signpost on the road of diversification.

And Just Bytes' Newcastle manager, David Freeman, who has recently returned to the area after managing another branch, said that he had noticed a change in the way people buy.

He said that, compared to other regions, there was more focus on software and networking equipment, which indicated an emerging strong IT infrastructure.

Another long-term Novacastrian IT channel business is PC assembler Maintain Axis Computers (MAC). Director Dave Huthnance stressed the need to diversify and seek out other market opportunities, which is what MAC has done.

He said that as an assembler it is picking up a lot of business outside the geographic area and highlighted government and education. As well as PC assembly, which Huthnance claimed has been as high as thousands of units per month, MAC has been providing cabling services over a wide area.

The consensus of opinion of those who spoke to ARN was that the Newcastle IT channel is alive and well, albeit trim and diverse in its individual businesses.

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