Primus-Telstra swap cuts power firm's bill

When Australian Power & Gas first became an energy retailer start-up in 2007, the company didn't secure the best deal on telecommunications services from Telstra. Once the company began heading towards a goal of 700,000 customers, CIO Joseph Gullotta thought that addressing this should be a priority for the growing company.

Australian Power & Gas currently resells electricity and gas services in Victoria, New South Wales, the ACT, South Australia and Queensland. In September last year, the company boasted 300,000 customers, and now aims to reach 700,000 by 2015. The company employs 72 people, and outsources a lot of its back-end billing services, as well as call-centre services.

When Gullotta joined the company over two years ago, he identified that he could save the company at least 30 per cent on telecommunications costs.

"I've done a number of these telecommunications negotiations in the past, and I knew I could go out there and get a better deal," he said.

"[The company originally] went directly to Telstra and got what they could from Telstra, and really the negotiations there really didn't take place. We've got pretty standard pricing, but nothing special," he said.

The data network was mostly pieced together between the Sydney and Melbourne offices and the company's two datacentres, and the company was using virtual private networks mainly for security. Gullotta said that he wanted to bundle the data network in with the voice network.

"What we wanted to do was really review all of this, and make us more attractive to a telecommunications company. And bundle it all up so we've got some volume, as well."

He said he wanted increased bandwidth for the data network, from 1Mbps to 10Mbps, with 30Mbps out of the company's main office. He also wanted to have the telecommunications company monitor the network for them to ensure that it was able to cope with increasing demands.

The tender came down to two choices, and Primus wasn't actually the company's first pick. The original winner — which Gullotta declined to name — had a good deal, but it didn't last.

"The other guys were offering slightly more in the deal with cross-promotion for customers, and we thought that was a good opportunity for us, [but] the problem was, they made a number of really fundamental problems right at the start, and then we just pulled out and said, 'you guys don't really have the environment or the know-how to move us across'," he said.

The other issue that the company encountered was that the telco couldn't handle APG's peak volume during the cut-over period, so, in the end, APG turned to Primus.

Primus was commissioned to provide a voice and data network, including a managed private IP network to connect the offices in Sydney and Melbourne based on a multi-protocol label-switching (MPLS) network core.

The voice network provided by Primus routes incoming 1300 and 1800 calls either to the company's outsourced call-centre services or through to the company's smaller internal call centre, based on demand. The company is able to manage the inbound calls, and monitor the performance of the call centres.

"We can easily, through those 1300 and 1800, direct the calls anywhere we wish," Gullotta said.

The cut-over was completed mid last year, he said, and it was a smooth transition.

"It was all to plan," Gullotta said. "First, we cut over our voice network, and then, on the last piece, we transitioned our data network across."

APG continues to grow, Gullotta said. It moved to virtualised infrastructure last year with VMWare, and in the last 12 months storage has doubled.

The deal is the third major coup for Primus in the last few months. In January, Primus won a three-year multimillion-dollar deal to provide Payless Shoes' network, and the company also secured a $6 million deal to provide voice, data and managed Wi-Fi services for Hungry Jacks.

(Front page image credit: Electricity image by Oleg Zaytsev, CC BY-SA 2.0)