TelstraClear bails on deal

TelstraClear and the Corrections Department have clammed up over the reasons behind a decision to dismantle a NZ$30 million (US$18.8 milllion) contract and return the business to Telecom New Zealand Ltd.

The official line is that "there were some issues". No one from either party is prepared to expand on this.

The six-year contract was to provide traditional PABX and frame relay services, switching to voice over IP in 2005.

Computerworld understands that the inability to deliver within the timeframe was behind the collapsed deal.

Sources say TelstraClear committed to deliver to Correction's 230 sites and 4,500 staff in a very aggressive timeframe, within six weeks, but couldn't complete the links from Telecom even after receiving an extension.

"They didn't even come close," one says. "It may have as much to do with Telecom's cooperation as Telstra's ability to deliver." TelstraClear spokesman Mathew Bolland will say only that the telco has a successful VoIP solution that has been rolled out to other customers.

The new environment was to have been based on TelstraClear's private IP network and managed Cisco Avvid architecture. Commenting on the deal when it was finalized in March, Corrections IT manager David Lyons said TelstraClear's guarantees in the contract had persuaded the department that was the way to go.

"Part of that was that the vendor was willing to stand behind the technology and their ability to guarantee. We asked 'what are you willing to do re quality of service, uptime etc?'"

Corrections has now re-signed the NZ$30 million contract with Telecom, which says in a brief release it has been tied to some very tight timeframes.

TelstraClear's inability to deliver may not put it in good stead when it comes to bidding for a major upcoming contract at Inland Revenue to convert its systems to voice over IP.

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