NSW shakes up core technology outsourcing model

The NSW government is to overhaul how it sources and manages whole-of-government infrastructure and core technology services, in a move that will shake up two long-standing outsourcing arrangements.

The Department of Customer Services has gone to market to establish a single commercial arrangement through which multiple specialist providers can deliver services across six core capabilities. 

This will disaggregate agreements held by NTT Australia, the holder of a $34 million managed network services deal, and a computing integration services deal that was handed to AC3 in 2021.

These two services – managed network and computing integration – will now sit alongside cloud services, FinOps, enterprise observability and firewall and networking licencing in the new arrangement.

Outlining the reasons for the service restructure, DCS said the previous arrangements “were built around legacy, on-premises environments and traditional service management models”.

The new modular model “enables DCS to open the market to specialised providers, promote competition and improve flexibility”, according to a department tender.

“It also creates opportunities for greater efficiency in areas such as service integration, tooling standardisation, supplier collaboration, and governance."

In a statement to iTnews, a DCS spokesperson added that the move will also help the department “align with modern digital practices”.

AC3 won the $39-million computing integration services deal following the end of Unisys' long-standing shared services contract in 2021.

At the time, AC3 said it would on-board a “collection of environments consisting of approximately 4300 systems” and would work closely to “unify/optimise all [DCS] systems and prepare them for transition to Amazon Web Services and Azure, as appropriate”.

NTT Australia, meanwhile, has provided managed network services since 2021 in an extended deal now due to expire on December 31 2025.