Multinational outsourcers are scrambling to get into bed with local Northern Territory IT firms to secure a piece of the $200 million Government IT outsourcing contract.
As bidding enters its final weeks, everyone is keeping their cards close to their chests, however industry sources suggest the most likely partner for IBM will be local NT firm Computer Support & Maintenance. Compaq and CSC will go threesomes with Connected Solutions Group, and Ipex has already announced its partnership with NT firm eNTITy 1.
EDS is also expected to enter the race and Dialogic and Data#3 are tipped as the only totally interstate companies bidding on the contract, even though the chances of an outside company winning the bid are predicted to be very slim.
David Knowles, managing director of NT firm CSM, believes it's highly unlikely a company will win the contract without a local base. "There's no chance of a South Australia EDS-type result," he said. "I think that whatever feedback the NT Government has received on that single tender has not been that positive."The NT Government has in fact put very strict requirements on the tender to protect the local market and its growth. And it appears these specifications are providing the basis of the bidding war.
Roger Allen, vice president of integrated business services at CSC, would not confirm or deny the rumours that they were partnering CSG, however he did say that CSC "will be complying with the tender requirements. The requirements are fairly specific, a company would not be able to carry out the contract from Newcastle or Sydney," he added.
Prins Ralston, managing director of eNTITy 1, is aggressively pushing the benefits of local businesses securing the deal. "In the Territory you have lots of multinationals who come up and promise things and to date not much is being delivered," he said.
"The advantage of a local company like us is that we're actually doing our industry development now, we've committed money and we're building, because regardless of whether we win or not we're here to stay. We're pumping the dollars in now whereas the multinationals are promising to do industry development contingent to them winning the outsourcing."Ralston said that while the multinationals might big-note themselves on having the resources and have done it all before, "the faces you see are the individuals on the ground and at the moment you can count them on a single hand. Most of them don't have offices here so they will either need to recruit the local talent or ship in people," he said. "In terms of their ability to deliver, it's like they're building a whole new business up here."In response to these accusations, CSC's Allen said that one multinational company has had a strong presence in the NT for the last 20 years. "It would not have been able to last if it wasn't producing on promises so this argument doesn't really stand," he said.
The NT tender closes on July 27 and the successful candidate is expected to be announced in November.