Tabcorp CEO details EDS deal
Tabcorp chief executive Elmer Funke Kupper today said the gambling giant's IT outsourcing contract with EDS has helped accelerate its multi-year IT transformation program and gain certainty about costs amidst tough economic conditions and natural disasters.
The comments constituted the first time that Tabcorp — owner of Star City and Jupiters casinos, TAB, Tabaret, Keno and TAB Sportsbet — has publicly discussed the deal, which was first reported by ZDNet.com.au in late April.
During an earnings announcement today, Kupper said the contract covered Tabcorp's data centres, systems platforms and data networks including voice and mobile services. The deal is believed to have been signed sometime before April this year.
Kupper said the contract had given the company "predictable technology expenses" and that the deal had accelerated its IT transformation program, which included improving its disaster recovery capabilities and the modernisation of its extensive entertainment venue network.
He also told investors and analysts Tabcorp had achieved a "significant improvement in operational and IT performance" since its half year earnings announcement.
Both EDS and Tabcorp have remained tight-lipped about the deal until today's earnings announcement. Ex-managing director of EDS Australia, Chris Mitchell, hinted EDS had won a rare "mega deal" earlier in the year, but would not confirm it had won Tabcorp's work.
Tabcorp signed the deal with EDS a year after completing the first phase of its shared services project which started in 2006 in partnership with IBM. By 2007 Tabcorp claimed the shared services initiative had resulted in operational cost reductions of 15 per cent.
As part of the project, Tabcorp implemented an Oracle enterprise resource planning system for its finance, human resources and procurement systems, now housed in the Melbourne-based shared services centre.
At today's results, Tabcorp revealed that its net operating expenses had increased by half a per cent to just over AU$1 billion for the full year.
Tabcorp claims it has now started the second phase of the project, hoping to further reduce operational costs and expects the project to be complete by 2009.