Vodafone Hutchison Australia (VHA) today confirmed it had appointed Indian IT services giant Tech Mahindra as its new IT managed service provider, in a deal which the Australian Financial Review has valued at around $250 million.

Tech Mahindra is part of the wider Mahindra Group, and is a global systems integrator and business transformation consulting organisation. In accordance with the contract, Tech Mahindra will now be responsible for the running and operations of VHA’s IT systems in a five year contract.

A statement by VHA this morning confirming the deal, which was first reported in the AFR, appears to imply Tech Mahindra will become the core supplier of IT services for VHA, which operates the Vodafone and ’3′ mobile brands in Australia.

Vodafone chief technology officer Michael Young said the appointment of one supplier only aimed at improving efficiency. “The new partnership will provide us with a single point of accountability for IT systems performance and management,” he said, adding customers would also benefit from the change. “It will also bring greater operational efficiencies and the ability to continuously improve our customers’ experience of our services,” he said.

Vodafone was this morning unable to immediately confirm how the services were previously being provided.

The decision to appoint a single IT managed service provider is the latest in a string of moves made by VHA to strengthen its operations. 2010 proved difficult for the telco as it faced network instability as well as customer dissatisfaction, as well as security problems within its staff base.

Another major investment came earlier this year, when VHA had announced it would replace its whole wireless access network. In that deal, it chose to partner with Huawei Technologies, which at that time said it was in the process of recruiting some 300 staff in Australia to help service the deal. In the same period, Tech Mahindra was awarded a multi-million dollar IT contract from Vodafone in Qatar.

Image credit: abcdz2000, royalty free

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1. Michael Wyres
   Posted 07/04/2011 at 3:08 pm | Permalink | Reply

   Sounds like a head office directive, rather than a local decision – particular since other Vodafone subsidiaries are heading down the same path, with the same supplier.

2. g
   Posted 07/04/2011 at 4:31 pm | Permalink | Reply

   We had a huge security breach… so let’s outsource IT security to the lowest bidder?!

   • Jon
     Posted 07/04/2011 at 4:33 pm | Permalink | Reply

     How do you know they were the lowest bidder? Tech Mahindra (or Mahindra Satyam) are not small players.

     The global work with TM could have been a factor, but wouldn’t be the only reason.

3. Thatguy
   Posted 08/04/2011 at 1:18 pm | Permalink | Reply

   @Michael Wyres – Vodafone Group have no say in the operations of VHA. VHA license the Vodafone brand from Vodafone Group (Who are also a shareholder in the VHA company)

   Outsourcing to 1 vendor didnt work when Vodafone tried it with IBM, there is no reason it will work this time! HA

   • Michael Wyres
     Posted 08/04/2011 at 1:48 pm | Permalink | Reply

     Vodafone Group plc has a majority ownership share in VHA – I’m sure they have more than a little “weight” at the boardroom level.

     • Thatguy
       Posted 11/04/2011 at 3:45 pm | Permalink | Reply

       Vodafone Grp PLC do not have a majority ownership of VHA, its 50:50 with Hutchison. And that is only at a financial level. The running of the company is all Hutch and VF Group really dont care. They get their 1% of service revenue and they are happy. Group have global agreements with many many vendors as you would expect but they dont hold VHA to account for the decisions on which way to go