DAFF had put out a tender for support of its desktop, server, storage and IT architecture services in September 2008. The department currently uses AAPT for data network services and Macquarie Telecom for internet gateway services.
At the time of the tender being released, the department's incumbent outsourced provider Commander was on its last legs, struggling to meet its obligations to pay significant debts.
Commander entered a bid to renew the deal, but wasn't shortlisted.
Upon Commander's collapse in November 2008, IT services company CSG took over the outsourcer's remaining managed services contracts and has subsequently been managing DAFF's IT requirements since.
Brian Lee, group general manager at CSG said the company will continue to meet the department's needs until June, when the work will be handed over to EDS.
Lee said CSG went into the eight month deal with DAFF "with the understanding that Commander had not been shortlisted" for the tender, which gave CSG no opportunity to place its own bid to continue working for the department post June 2009.
David Caspari, managing director for EDS in Australia and New Zealand said DAFF presents EDS with some "unique and exciting challenges."
DAFF employs 5,000 Australians across 300 Australian towns and cities, literally spread across the whole nation.
"It is the most geographically spread out department in the country," he told iTnews. "We will be delivering services to everything from a large location in Canberra to the most remote regional sites, some with only a single employee."
Caspari said EDS will have to stretch its resources into new areas of central, regional and remote Australia. "It requires that we put on a significant team in place to support the deal," he said.
A spokesperson for DAFF said the outsourcing agreement "does not drive a restructuring of IT staff within DAFF."
EDS has stressed that the deal - which includes an advisory role in terms of delivering 'IT architecture' services - will provide unbiased advice to the Department.
Caspari said EDS will not be biased into recommending the servers, desktops and storage products of its parent company, HP.
"At its most fundamental level, our solutions are based on customer needs, requirements and preferences," he said.
"It is substantiated in the framework [of the contract] that we deal with multiple vendors regardless of whether they offer similar products or very different ones [to HP]."
Caspari said the contract would stand EDS well in its attempts to win and win back Australian Government outsourcing work.
"This is a very significant deal, as it gives us greater mindshare in Canberra," he said. "It will enable us to demonstrate in Canberra our latest generation infrastructure and capability. That is helpful in positioning us for more business there."
Caspari would not comment on EDS' attempts to retain the business of the Australian Tax Office (ATO), which is embarking on a new tender process for the next ten years after being one of EDS' largest Australian customers over the past decade.
CSG, meanwhile, continues to build its presence in Canberra, despite the DAFF contract coming to an end.
Lee said the acquisition of Commander's managed services business gave CSG "a foothold in Canberra", where it will continue to employ 70 to 80 staff.