Gen-i denies communications bait used to win ACC contract

While price is an important factor it is rarely the deciding factor in selecting suppliers, says ACC CIO

Accident Compensation Corporation chief information officer Graeme Osborne has refused to comment on suggestions Gen-i used a whole-of-business discounting arrangement with its parent, Telecom New Zealand, in its successful bid to win a major ACC services contact.

The Gen-i-led consortium will supply services to the state-owned insurer for operations, help-desk, networks and desktops over the next five years.

Others in the consortium include Sun, iData and Red Rock Consulting.

Computerworld has been told Gen-i included a value-add clause in its bid, offering an additional discount on all revenues above a certain number.

That would mean that the combined spend for IT and voice communications would attract a “whole of book” discount of 25% once this number was exceeded, says the source.

The source claims this is an example of monopoly-pricing being used to buy business.

However, a Gen-i spokesperson says there was no linkage between the services bid and telecommunications.

Osborne says any agreement between ACC and a supplier is commercial and in confidence.

“A general comment I would make is that while price is an important factor it is rarely the deciding factor in selecting suppliers, especially for multi-year services-based contracts,” he says.

IBM, which partnered with Infinity, was the under-bidder on the short-list for the contract.

The incumbent, Unisys, did not make the short list.

ACC and Gen-i are expected to conclude contract negotiations by the end of August.

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