IBM wins expanded Telstra deal

IT’S not every day that IBM’s global chief rolls into town. So when Big Blue CEO Sam Palmisano blew into Australia for the first time since taking the helm, it was always a good bet that the local subsidiary would make a big announcement.

No surprise that the announcement should involve Australia’s largest company (and a nine-figure number).

IBM said it has expanded its existing seven-year supply chain deal with Telstra, an extension that would deliver $200 million in additional cost reduction benefits to the telecom giant.

Telstra procurement executive director Ian Wheatley said Phase One of the company’s supply chain project with IBM had been a success and the company was on target to save $500 million over seven years.

The next phase of the supply chain transformation program would focus on improving Telstra’s efficiency in ordering, managing and delivering telecommunication parts needed by technicians and engineers to perform network maintenance, fault repairs and activation of customer services.

“In the first phase of our supply chain transformation, we replaced four payment and ordering systems with IBM's out-of-the-box software,” Mr Wheatly said.

“In phase two of the program, IBM will provide a single end-to-end view of our inventory supply chain and enable us to deliver the right part, at the right place, at the right time – improving customer service and reducing costs. This is great news for our customers and shareholders,” he said.

Telstra says it has reduced its procurement costs by $159 million since September last year.

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We’ll proceed without Telstra: Tanner

THE Rudd Government was unfazed by Telstra blunt rejection of plans to build a national broadband network based on joint public-private funding and ownership.

Newly sworn-in Finance Minister Lindsay Tanner has told ABC Television the Labor Government would proceed with the $4.7 billion plan for the national network with or without Telstra.

And the Government’s new Minister for Broadband, Communications and the Digital Economy, Stephen Conroy, said Labor remained committed to building a national fibre-to-the-node network.

Senator Conroy said government hoped to complete the tender process to select partners to build the network by the middle of next year.

“It will be open access, promote competition and put downward pressure on consumer prices,” Senator Conroy said. “We will hold an open and transparent process to determine who will build the network with our ambition being to complete the process by the end of June next year,”

“We expect that there will be much public commentary, jockeying and lobbying from parties as they work to convince the Government that they are best placed to build the new network and seek the terms that are most favourable to them.”

Labor promised in March that it would contribute $4.7 billion in public money toward a public-private national “open access’’ network. Government will issue tenders next year seeking proposals from the private sector to build the network.

But Telstra chief executive Sol Trujillo last week last week rejected the plan, saying the company would only participate in projects that “we own and control.”

Mr Tanner said the Government’s plans were not contingent on Telstra taking part.

“The policy we put forward some months ago is a position that still stands. We are going to proceed,” Mr Tanner said.

“It is Telstra’s choice as to what role they want to play or not,” he said.

Government would wait until seen private sector proposals as part of the tender process before deciding how to structure the network.

Mr Tanner said the policy had been kept as flexible as possible so that the private sector could develop new ideas for implementing a cost effective and technologically efficient network.

“We are going to proceed with the position that we put to the Australian people,” Mr Tanner told the ABC Inside Business program.

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ICT get a boost in new Cabinet

THE technology industry has been given a major profile boost in Prime Minister Kevin Rudd’s first Cabinet, with the appointment of two senior Ministers with responsibility for ICT-critical issues.

Stephen Conroy was appointed as Minister to the newly-named portfolio of Broadband, Communications and Digital Economy. Senator Conroy has been shadow IT and communications spokesman since 2004, and had been expected to retain those responsibilities – largely because of the incredible complexities of telecommunications regulation (and Telstra-related regulatory issues).

Senator Conroy was a driving force behind Labor’s bold A$4.7 billion national broadband pledge, made in March.

Less expected was the appointment of fellow Victorian Senator Kim Carr as Minister for Innovation, Industry, Science and Research. Senator Carr had been shadow Industry Minister, but Mr Rudd bolstered the portfolio with the addition of Innovation.

Senator Carr will oversee the implementation of industry assistance programs – which will play a huge role in the development of indigenous software companies.

The appointments have been welcomed by the industry.

“We are pleased that the Prime Minister-elect, Kevin Rudd, has acknowledged technology as the driving force of our nation’s economic prosperity and reinforced this stance by including the ICT portfolio in Cabinet,” said the Australian Computer Society’s out-going national President Philip Argy.

“Innovation is a pivotal force in building our national economy and energising our industry. Our prosperity is dependent on productivity gains underpinned by innovation in information and communications technologies,” Mr Argy said.

Lindsay Tanner’s appointment as Finance Minister in the Rudd Cabinet has also been welcomed. Mr Tanner has been a Shadow Communications Minister and is very familiar with the industry.

As a technology buyer, the federal government wields, tremendous influence through the Australian Government Information Management Office (AGIMO), which falls within the Department of Finance.

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Facebook buried in privacy complaints

FACEBOOK has been forced to overhaul its new advertising system following an avalanche of privacy complaints and bad press about the company’s lack of respect for its users.

The advertising system, called ‘Beacon’, was introduced less than two weeks ago and sought to share what online purchases its users had made with their friend network.

While Beacon displayed an “opt out” button when a user was making a purchase, large numbers of Facebook users were incensed. Others complained the ‘Opt Out’ feature was itself offensive, but were more bitter that the ‘Opt Out’ button was so well hidden.

Within nine days more than 50,000 users joined a “Facebook, Stop Invading My Privacy” group on Facebook itself, and signed a petition complaining about the intrusion.

Facebook has now announced adjustments under which users will have to the give explicit consent in the form of an ‘Opt In’ regime before any of their information is shared.

More than 40 web sites had embedded Beacon into their pages in order to track the transactions of Facebook users.

The privacy advocacy group MoveOn.org, which organised the petition campaign, welcomed the changes.

“If Facebook changes their policy so that no private purchases made on other websites are displayed publicly on Facebook without a user's explicit permission, that would be a huge step in the right direction – and would say a lot about the ability of everyday Internet users to band together to make a difference,” MoveOn.org Civic Action organiser Adam Green said.

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Adobe, Yahoo launch PDF advertising

ADOBE and Yahoo have launched a service that lets commercial publishers run dynamically generated advertising within PDF documents.

The companies say the service opens up a new frontier for the online advertising market, putting contextual advertising that matches the readers interests in PDFs.

Called ‘Ads for Adobe powered by Yahoo’, the service has been launched initially as a beta program.

“By partnering with Yahoo! on this innovative advertising service we are creating opportunities for publishers to build new businesses around unique content that previously was just given away or not available to a mass online audience,” said Adobe senior vice-president for Corporate Development, Rob Tarkoff.

“As advertisers look to touch new audiences, readers can look forward to some exciting Adobe PDF content coming their way.”

Yahoo! Publisher Network senior vice-president Todd Teresi said the partnership created a previously untapped opportunity for advertisers to connect with qualified audiences, while opening new revenue streams for publishers.

Particpants in the beta program include IDG InfoWorld, Wired, Pearson’s Education, Meredith Corporation and Reed Elsevier.

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Google confirms wireless spectrum bid

SEARCH leader Google has confirmed it will participate in the US Federal Communications Commission’s spectrum auction – underlining the company’s interest in entering the wireless voice and data device markets.

As part of the US’ mandated transition to digital television, the 700 MHz spectrum auction – which begins January 24, 2008 – will free up spectrum airwaves for more efficient wireless internet service for consumers.

Bidding for the spectrum will start at a reserve price of US$4.6 billion (A$5.2 billion). Google announced it will enter the auction without the assistance of a partner. Some industry observers had thought the company would partner with a telecommunications firm for the auction.

The auction stipulates that part of the spectrum be used for open access purposes – under which the winning bidder is compelled to give customers the right to download any application they want on their mobile device and the right to use any device they want on the network.

“We believe it's important to put our money where our principles are,” Google chairman and chief executive Eric Schmidt said. “Consumers deserve more competition and innovation than they have in today's wireless world.”

“No matter which bidder ultimately prevails, the real winners of this auction are American consumers who likely will see more choices than ever before in how they access the internet,” Mr Schmidt said.

The 700MHz spectrum is attractive to communications companies as it wavelength travels long distances and easily penetrates obstacles like concrete walls. This means the spectrum requires fewer communications towers and is therefore cheaper.

Regardless, a national wireless network would be expected to cost the owners an additional US$7 billion.

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CeBIT Asia mission reports $29 million in sales

THE Victorian delegation to the CeBIT Asia business technology fair in Shanghai generated more than $29 million in projected business in China, the state’s technology agency Multimedia Victoria has reported.

The 29 Victorian companies participating in the October mission to CeBIT Asia found more than 30 reseller and distribution partners, and secured more than 100 serious business leads, the Multimedia Victoria mission report said.

In the wake of that success, Hannover Fairs Australia (HFA) has already confirmed it will again take a delegation of Australian companies to the CeBIT Asia next year. HFA, the organiser of the giant CeBIT Australia ICT fair, is the local unit of global exhibition group Deutsche Messe AG, which runs CeBIT events worldwide.

Victorian Information and Communications Technology Minister Theo Theophanous said China was an important and fast-growing market for Victorian ICT companies. The delegation was supported by the Brumby Government’s ICT Trade Events and Export Assistance Program.

The Victorian Minister for Information and Communication Technology, Theo Theophanous, said it is the second year that the Victorian Government has led an ICT delegation to China and reinforces the State’s enthusiasm to forge partnerships in this lucrative market.

“Victorian ICT companies specialising in areas such as mobile technology, digital media, web development, eLearning and content management stood out, presenting their ingenuity to a global audience,” Mr Theophanous said.

“China is one of the largest emerging ICT markets and this trade mission has provided home-grown Victorian companies fantastic opportunities to build on previously formed relationships, open up new supply chains, gain new clients and network for future export opportunities.”

Since 1999, the Victorian Government’s Export Assistance Program has helped 480 Victorian companies on trade missions to 40 countries, generating $1.7 billion in projected exports.

While CeBIT Asia in Shanghai was the centrepiece of the Multimedia Victoria trade mission to China, it also included meetings and networking events in the Chinese business centres of Chengdu, Kunming, Beijing and Hong Kong.

Hannover Fairs Australia managing director Jackie Taranto said the Victorian Government’s long term view of building business relationships in China was paying off. Six companies involved in CeBIT Asia with Multimedia Victoria had returned to the event for their second year, cementing the business ties established at the 2006 event.

“Establishing ongoing exports links with partners in China can take time and patience, and it was great to see those Victorian companies returning to CeBIT Asia for a second time doing so well,’’ Ms Taranto said.

“Multimedia Victorian has built enormous expertise in the China ICT sector, and they run targeted and superbly professional trade missions. The long term commitment to the China ICT market is showing clear results, not just by generating exports dollars, but attracting inward investment from Chinese companies as well,” she said

China the Victoria’s third largest export market (A$1.8 billion in 2004-05) and largest source of goods imports (A$6.3 billion). Some of China’s largest ICT companies are represented in Victoria, including communications giants Huawei Technologies and ZTE Corporation, as well as consumer electronics makers Changhong Electric and TCL.

The Multimedia Victoria pavilion at CeBIT Asia attracted a stream of political and business leaders, including the vice-chair of the Shanghai People’s Congress Zhou Yu Peng, one of the most influential figures in the region, and California Lieutenant Governor John Garamendi, who led a US trade mission to CeBIT Asia.

Victorian software firm Business Intelligence Technologies participated in the CeBIT Asia trade mission for the second year, and reports significantly extending its China business.

“The trip presented challenging and unique opportunities for our products and services, and we are seriously exploring setting up a China entity,” said Raghu Iyer, founder and chief executive of Business Intelligence Technologies. “Attending CeBIT Asia as part of a government delegation – going with Multimedia Victoria – is definitely a help because it helps build a network of contacts.”