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Half of nothing is still nothing

Half of nothing is still nothing

There are two types of people in this world - some think the glass is half full while others wonder where the rest of the drink went. So it should come as no surprise that the NSW government decision to segregate local and multinational PC suppliers drew a mixed response from the Australian builder community (see page 4 of the print edition, ARN October 25, 2006).

Pioneer Computers' Damon Hardman was in no mood for celebrating after he heard the news because he has taken the view that this locks local suppliers out on 80 per cent of sales. But while everybody is entitled to an opinion, I agree with ASI's Craig Quinn that the decision to fence off a portion of PC supply specifically for boxes built in Australia is a positive for local industry. While leaving everything open to all bidders would have give local companies a bigger target to aim at, it would have been very difficult to compete with the multinationals in centralised government purchasing. At the end of the day, half of nothing is still nothing.

Theoretically, Acer could compete in the portion of the contract that has been restricted to local suppliers because it has a manufacturing facility in Sydney. But that is about as likely as a white Christmas in Alice Springs because it would exclude the Taiwanese vendor from the remaining 80 per cent of the contract. Acer is certain to say 'thanks, but no thanks' and take its chances in the multinational pool with the other heavy hitters.

From a local builder point of view, the only major concern I have is that the multinationals have been guaranteed a minimum of 80 per cent. While local suppliers have been given their own pool to swim in, there are no assurances that NSW government will buy the remaining 20 per cent from them. Only time will tell how much business comes their way.

But if local builders are divided on the pros and cons of separate NSW government lists for PC procurement, Queensland integrators are united in their Citec concerns (see page 1). The state-owned IT services company is turning its back on the commercial world in favour of a new role as the primary public sector provider of ICT products and strategies. A review tabled in parliament earlier this month has also recommended it manage services wherever its involvement would reduce government costs.

On paper, this sounds more than a little frightening for the integrators currently supplying those services. In all likelihood, there will still be instances that call for their particular fields of expertise but they are sure to lose some business under the new arrangement. Again, only time will tell how damaging this is.

On the other side of the fence, software developers in the Sunshine State have welcomed the news because money saved on integration costs will mean a larger pot is available to spend on their new technology. For them the glass is half full, but that must be a difficult way to see the world right now for Queensland integrators that do a lot of work for state government.


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