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Data#3 wins $8m Queensland gov deal

Data#3 wins $8m Queensland gov deal

Data#3 has snared a contract with the Queensland State Government to deliver Microsoft software licensing and asset management services.

The service company's CEO, John Grant, said it beat off competition from other Microsoft large account resellers (LARs) as well as companies providing specific licence management services. The three-year whole of government deal includes about 20 agencies.

Data#3 will supply software and updates under a Microsoft open government licensing agreement.

The core component would be centralised software asset management services, Grant said. This involved developing and maintaining a software licence register as well as helpdesk support. Data#3 would also consult with individual agencies on software practices.

"Queensland licensing contracts have been about the supply of software up until now, but with the licensing and privacy issues rising, it now needs to be about overall software management," he said.

Data#3 initially provided software licensing to the state government under a joint Queensland Software Services (QSS) venture with IT services company, Powerlan. The contract, struck in 2001, was worth $77 million.

The venture came to an abrupt halt in August 2002 when Powerlan's Queensland subsidiary went into administration. A dispute followed over the issue of creditor payments.

Although Data#3 wound up with a sole supplier agreement to the state government, it took a $2 million hit in order to appease creditors and customers. At the time, Grant told ARN the venture had been a negative acquisition and nothing about the experience was positive.

Once the four-year contract expired, the government decided to revert back to agency software purchasing under Microsoft's open government licensing program. Licences were previously purchased under the vendor's enterprise agreement.

"This broke down the centralised management of software and left them without a full record of purchases," Grant said. "On our advice, they issued a tender for software asset management for the whole of government again."

He would not be drawn on the value of the deal, but noted procurement of Microsoft software had been fairly low in Queensland during the past two years. He attributed this to limited releases during the period.

"We have no idea on the level of expenditure as the government has lost track of that," he said. "The tender has the potential to increase in value - if not now, then in the subsequent phase or next contract."

Grant said Data#3 would hire new staff to expand its consulting resources.

"This deal is more expansive than our other software asset management deals in that we are actively providing asset management to all Queensland government agencies," he said. "It validates the investment we made and expands our capabilities. It is also a very significant consulting agreement for us."


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