Little guys double-trump majors to Centrelink deal

Canberra-based service provider Infront Systems has double-trumped a dozen of its far larger multinational competitors to win a lucrative virtualisation software licensing deal with welfare agency Centrelink.

Infront will provide the agency with 40 licences initially -- and potentially a further 82 licences -- for VMWare's EMX virtualisation software.

The software will be used in a Centrelink initiative to consolidate several hundred Windows-based servers across two datacentres over the next three years.

"Centrelink operates a large fleet of underutilised servers," says Centrelink General Manager, Hank Jongen. "With virtualisation we can supply equivalent services on fewer servers and accelerate our delivery times through deploying virtual instances of our Windows 2003 environment on existing hardware in our datacentres."

The deal is Infront's second win with Centrelink in the last 12 months -- both at the expense of some far larger competitors.

Infront initially won an approximately AU$100,000 tender for the analysis, sizing and design of the virtualisation project in July 2006, in conjunction with partner company Kaz.

The new deal came about after Centrelink released a tender on behalf of the Department of Human Services (which also includes Federal agencies Medicare, Child Support Agency and others) earlier this year for the licensing, support and training required for the consolidation project.

"Infront provided the best value for money and we subsequently awarded them the contract," Jongen said.

With the initial 40 licences valued at some AU$465,000, the deal has the potential to yield the 25-man company three times that amount -- well over the AU$1 million mark.

"We flagged at the time of the tender there was the potential to purchase up to 115 licences [for Centrelink] and up to seven licences across the Human Services portfolio," Jongen said.

It's a considerable win -- especially considering the tender was a popular one in Canberra.

Infront director Allan King boasts that "just about everyone" bid for the licensing business -- 12 companies in total, including multinationals IBM and Dell.

"[Centrelink] could have gone with anyone [for licensing]," King said. "But we wrapped our pricing with some value-added services such as support. Plus we had that existing relationship -- in Centrelink's own words, we did a very good job of the consulting project."

King said his company might be small, but it brings capability and focus to any organisation in Canberra considering virtualisation.

"Outside of the outsourcing market -- where we don't play -- we did 60 percent of VMWare's business in Canberra in the last 12 months," he said.