Editorial: Will centralisation mean consolidation?

Editorial: Will centralisation mean consolidation?

It would be an exaggeration to suggest the Contract 2000 tender issued by NSW government last week is make or break for Optima (see page 1 of the September 27 issue of ARN Magazine). But given that centralised purchasing looks to be the way forward in the public sector, the amount of NSW business won by Australia's largest PC maker during the next 12 months will shed a lot of light on its future prospects.

Government departments are the lifeblood of Optima and its Melbourne-based rival, Ipex. Both manufacturers have developed strong bonds in the public corridors over the years and have survived in the face of fierce multinational pricing competition largely on the strength of being tried and trusted technology partners.

Now that NSW has centralised purchasing, it must be a worry that those relationships will count for less. With an estimated $500 million to be spent on PCs, notebooks and servers during the next three years, multinationals will undoubtedly be offering the government attractive price breaks for higher volumes. As in the corporate arena, bean counters will be combing through every order to maximise cost efficiency.

Although it has been a massive undertaking for NSW to get centralised purchasing off the ground, we can expect other states to follow suit if it proves to be a hit.

It will be mandated that a certain percentage of NSW hardware spending will go to local companies. But a Department of Commerce spokesperson was unwilling to provide details until that number had been related to potential tenderers at an industry meeting due to take place this week (September 28). Whatever that number turns out to be, let's hope centralised purchasing doesn't turn out to be another nail in the coffin of local PC manufacturing.

In other news, CA has announced plans to hand 200 named accounts to partners (see page 1 of the September 27 issue of ARN Magazine). It is great to see another major vendor making positive noises about its channel and acknowledging that the vast majority of customers enjoy better levels of service when purchasing product via a channel model. The 200 accounts being made indirect will be very nice business for those that get the nod.

Finally, for this week, AMD has bestowed the honour of official validation for its media centre offering, AMD Live!, on a local builder (see page 4 of the September 27 issue of ARN Magazine). The announcement is something of a feather in the cap for Altech because builders always like to be first among their peers.

Unfortunately, making a lot of sales is likely to be a completely different kettle of fish. The response of official multinational launch partners Acer, HP and Dell speaks volumes. Three months after Live! launched locally, only direct-dealing Dell has bothered to build a compatible box. HP is expected to announce one sometime soon but Acer seems largely disinterested, although it is still in discussions with AMD.

The reluctance of major PC partners to get too excited is not at all surprising. Following Microsoft and Intel, AMD is now the third vendor to knock on their door with promises of revolutionising the humble PC and making it into a lounge room centrepiece. The results, to date, have been less than spectacular.

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