Telecom plays coy on Computerland
- 27 June, 2004 22:00
Telecom CIO Mark Ratcliffe refuses to discuss persistent rumours that the telco will buy Computerland.
“I’m very aware of the rumours going around for the past six weeks but I’m not going to comment,” Ratcliffe says.
Senior industry people who declined to be named consider the purchase a done deal. But one IT manager who spoke to Computerworld on condition of anonymity says he has a written guarantee from Computerland that it will not be sold.
The conditional purchase of Gen-i by Telecom is proceeding apace. Ratcliffe says he will address a Gen-i sales conference tonight and he expects the $62.5 million deal to be closed next week.
Ratcliffe said last week that the merger of Telecom Advanced Solutions with Gen-i would probably make it number two in size behind EDS. In reality, it would be number three, with IBM in the number two position, but if Computerland were brought into the fold it would be the second biggest integrator in the country.
Though Telecom has a 13-year outsourcing deal with EDS, it has not always been happy with the way matters have played out. Long-term outsourcing arrangements are notorious as the cost begins to bite around year five when the provider begins to make a profit.
Ratcliffe has positioned EDS as being a higher-end player than Telecom Advanced Solutions and Gen-i. However, it is difficult not to see them bumping heads in a highly competitive market. Buying Computerland would add weight and capability. A complication, though, is the fact that Computerland is a franchised operation, which may make absorption into the Telecom fold tricky.