The federal Department of Defence has awarded a five-year, AU$200 million contract to Kaz whereby the Telstra services subsidiary will assume responsibility for providing remote support to 90,000 desktops around the country.
In a statement issued today, Kaz said it had won a competitive tender for the outsourcing of Defence Central Office IT Infrastructure Support Services. Those tasks will now largely be undertaken by Kaz staff located in Defence offices in Canberra, who will deliver services using IP-based wide area networks to 325 offices nationwide.
Network operations are to be subcontracted to Boeing Australia, who won through on their expertise in "network centric warfare" and existing Defence networking credentials, Kaz said.
Kaz said the contract included options for Defence to extend for 10 years at two-year intervals. The Telstra division plans to recruit more than 200 staff to service the deal -- however many of these will come from Defence ranks.
The IP networks are to conform to two levels of security -- restricted and secret -- and provide access to corporate applications and e-mail, as well as specialist command control and intelligence applications.
Under the contract, Kaz must deliver; 24x7 management of the Defence restricted and secret networks; an ICT infrastructure management capability across central office functions; enhanced service levels, particularly in relation to service desk and incident resolution and; enhanced support during peak periods.
"Kaz succeeded following a competitive tender, which short listed 14 of the world's top IT companies," said chief executive officer Mike Foster.
Defence issued the tender in April last year and started contract negotiations with Kaz in December, he said.
"This success endorses our ability to leverage the end-to-end ICT capability that we bring to market as part of Telstra."
In a conference call this afternoon, Foster cited two main reasons for Defence's decision to outsource the previously in-house function.
"They were looking for continuous improvement in their service levels," he said.
Defence was moving to implement Information Technology Infrastructure Library (ITIL) standards for service management, according to Foster, and saw Kaz as a way to speed the move.
The decision was reflective of general market trends to "to take functions that are non-core [outside the organisation]", he said.
Also pivotal to the contract win was Kaz's status as "the largest employer of people with top security clearances", according to Foster. This would give the company a good platform for similar opportunities in future, he said.
The transition of Kaz staff and services to Defence would begin Friday next week, when the contract formally takes effect, Foster said.