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A new generation of South Australian ICT Contracts coming soon

by Paris Cowan •
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In what could be its biggest ICT procurement reform since 2005, the South Australian Government plans to establish a suite of re-considered and re-aligned whole-of-government ICT contracts to replace the 15 contracts currently in place across the State.

According to a background document aimed at potential new suppliers to the State Government, the first approach to market under the new procurement scheme could take before the end of June 2012.

Labelled ‘Tranche Three’, the ICT procurement overhaul is the latest stage in the reform process which began in 2005, when the South Australian Government’s ICT procurement division ICT Strategic Services (ICTSS) decided to break its existing “monolithic” Whole-of-Government ICT managed services arrangement with EDS into ten separate IT contracts, or Tranche One.

“While the ITSSED agreement was of benefit to the State at the time, there was widespread agreement amongst State agencies that after nine years another ‘one-size-fits-all’ approach was no longer appropriate,” says the background document.

Tranche Two, given cabinet approval in December 2005, dealt with the Government’s telecommunications supply in a similar manner, resulting in the establishment of five whole-of-government panels.

In this third and latest tranche, the ICTSS wants bring its IT and Telecommunications contracts together to reflect what it sees as the growing convergence between these two markets.

“Traditional ‘telecommunications’ companies now regularly compete to provide ‘as-a-service’ or ‘Cloud’ IT offerings, while traditional IT companies compete to provide services such as Voice over IP (VOIP),” says the document.

This convergence will be embodied within a brand-new Network ICT Infrastructure Services panel. The ICTSS hopes to bundle all existing network-related panels into this single arrangement, taking in:

  1. Telecommunications Services Panel;
  2. Active Devices Panel;
  3. Managed Network Services Panel;
  4. ISP Services Panel; and
  5. Mobile Carriage Services Panel.

The ICTSS is currently negotiating transition-out agreements with its ISP and Managed Network Services providers to extend the expiry date of these agreements out to March 2014, to align them with the three remaining network panels.

 “The State hopes to approach the open market for all these services in the first half of 2012, with a view to new arrangements being in place by March 2014,” says the ICTSS in the document.

The Telecommunications Services Panel, which includes Telstra; Optus; Nextgen Networks; Internode; Amcom and AAPT, is estimated to have seen $389 million worth of business over its six-year term.

The Managed Network Services contract has just one supplier, Dimension Data, and is estimated to be worth $80 million over its three year term.

The remainder of the network contracts are valued at between $2 million and $21 million across their terms, as outlined here.

Other panels under revision are the Client Computing and Server Equipment panel ($20 million over three years), which will expire at the end of this month, and the Printer and Photocopier Equipment (PPE) panel ($33.5 million over three years), expiring 30 June 2012, which is set to become the Document Output Devices panel.

Contract negotiations are already underway with shortlisted suppliers for both of these revised panels.

A set of new categories of supply are being considered by the ICTSS, including:

  1. Storage Equipment;
  2. Messaging and Business Communication Services (to replace the existing electronic messaging services contract with an expanded scope);
  3. A revised Mainframe Computing Services contract;
  4. Processing and Storage (to replace Distributed Computing Support Services, with an expanded scope taking in ‘as-a-service’ offerings); and
  5. A revised Microsoft Software Licensing arrangement.

In addition, the ICTSS hopes to implement a new contracting structure, where each supplier enters into a single Head Agreement with the Government regardless of how many different panel contracts they are appointed to. Each separate supply arrangement will be recognised through a subordinate purchasing agreement.

The background document also outlines the South Australian Government’s approach to Cloud Computing for the years ahead. Following on from the Cloud Guidelines released by the Australian Government Information Management Office (AGIMO) at the Federal level, it encourages agencies to consider Cloud options for low-risk business needs (such as content on public-facing websites), but adds that for legal reasons more sensitive data should be restricted to private or state-owned infrastructure.

The South Australian Government has invited interested members of the ICT industry to attend a briefing on the Tranche Three reforms, to be held 7 March 2012 in Adelaide.


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