Telstra adds 6500 servers to leasing deal

Telstra adds 6500 servers to leasing deal

Telstra is claiming huge bottom line benefits from its 1998 decision to sell its PCs to a financing company and then lease them back. Today it announced it was adding 6500 Intel and Unix-based servers in a four-year $109.5 million extension to the PC deal with IBM Global Financing.

When added to the $96 million PC deal of two years ago, financing arrangements with IBM GF have freed up more than $200 million of capital for Telstra while creating operating efficiencies in the supply, maintenance and disposal of hardware. The sale and leaseback of Telstra's PC hardware was dubbed as the largest PC sale ever when it took place.

According to Telstra director of finance, John Stanhope, the latest deal is to cover its 6500 file and print and mid-range application servers from Telstra sites across Australia.

"This deal will deliver smarter asset management and cost centre tracking by our line management and more flexibility to upgrade technology as the business requires," Stanhope said in a press statement.

According to the statement, the age of the assets varies with some scheduled for replacement as soon as 12 months. It also allows Telstra to retain the right to choose its suppliers of future upgrades but "does not include any help desk or maintenance facilities", the statement claimed.

Steven Worrall, IBM GF's general manager pointed to the success of the PC deal.

"We made a very competitive offer and Telstra saw savings benefits in having its PCs and servers with the same financiers and on the same asset register," he said.

A spokesperson for Telstra said benefits from the original PC deal included "a 30 per cent reduction in new equipment requirements through utilisation of idle inventory, improved technology management and the implementation of expenditure controls".

Meanwhile, it was claimed a further $10 million was saved in stocktake certification through a new "electronic PC tracking system".

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