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

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

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

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