[LINK] IBM snares $126m Health contract extension

[Bernard Robertson-Dunn]

IBM snares $126m Health contract extension
Selina Mitchell
JANUARY 13, 2004  
The Australian
http://australianit.news.com.au/articles/0,7204,8373833%5E15316%5E%5Enbv%5E15306,00.html

IBM Global Services has scored a $126 million five-year extension to its
federal Health Department IT outsourcing contract.

The deal has not been formally announced, but IBM staff were notified about
the contract extension by email on Christmas eve. The contract is said to
include changes to technology, but legal terms and conditions are unchanged
from the $350 million Health Group contract let in September 1999 as part
of the now-defunct Whole of Government IT Outsourcing scheme.

The group included the Health Department, the Health Insurance Commission
(HIC) and Medibank Private. The HIC and Medibank are still negotiating on
their IT requirements.

Department of Health and Ageing secretary Jane Halton signed the five-year
extension to IBM's contract a few hours before IBM staff were notified.

"This outstanding win has been achieved in less than 14 weeks and positions
IBM for future growth across the entire offerings portfolio," the internal
email says. "The extension provides Health with a complete infrastructure
refresh of its mainframe, midrange, network, storage, desktop and
cross-platform services."

According to the email the deal also includes end-to-end service levels and
an opportunity to earn service-level credits based on end-user
satisfaction.

Principles for future partnering between both parties are embedded in the
contract. IBM would not comment on the contract, but a spokesman said the
company had worked hard in the past year to improve client service.

A Department of Health spokesman confirmed the contract extension and said
a formal announcement would be made when managers returned from holidays.
"It was a cost-effective solution for the department," the spokesman said.

-- 
The first wealth is health
-- Ralph Waldo Emerson

Regards
brd

Bernard Robertson-Dunn
Canberra Australia
brd at austarmetro.com.au