RealTime IT News

IBM Puts Qantas' IT Business in its Pouch

Extending a relationship that reaches back decades, IBM has signed Australian airline Qantas to a new contract worth approximately $450 million over 10 years.

The agreement between the Armonk, N.Y., system vendor's service arm and the Australian airline begins May 31 and combines two cornerstones of IBM's business.

The first is IT outourcing. Big Blue will handle help desk support, security and change management across all of Qantas' IT service providers. The airline expects to save time and money by employing IBM as the point of contact for the various suppliers.

The second is on-demand data center architecture. IBM will move Qantas' servers to a shared infrastructure at an IBM data center in Sydney.

This model allows Qantas to purchase processing power and storage on an as-needed basis, much like homeowners buy water and electricity. IBM competitors such as HP also offer their own versions of the service.

IBM spokesman John Buscemi said 70 Qantas IT staffers and 10 contractors will join IBM as part of the agreement. Such transfers are common in large IT outsourcing deals and are part of the motivation for companies because they can jettison salary and benefits.

The companies did not say how much Qantas expects to save over the life of the contract.

Qantas officials cited IBM's experience with other airlines as a key reason why it chose Big Blue for the contract. Among the projects IBM has completed in the sector include: networked kiosks for Air Canada and British Airways; computer telephony integration for Air New Zealand; and a wireless platform for Delta Air Lines.

In deepening its relationship with Qantas, IBM can boast a pioneer on its customer list. Qantas was founded in 1920 in the Queensland outback with open cockpit biplanes. Today it has a fleet of 187 aircraft flying to 32 countries.