Qantas Takes Off with On Demand

Long-distance airline awards IBM Global Services $650 million IT services contract

Long-distance airline awards IBM Global Services $650 million IT services contract

Armonk, NY — May 17, 2004 — Qantas, one of the world's leading long distance airlines and one of the strongest brands in Australia, today announced that has selected IBM Global Services to manage its data center and related information technology (IT) requirements.

Qantas, which operates operate a fleet of 187 aircraft across a network spanning 142 destinations in 32 countries, said it made the decision to outsource its IT systems in order to allow the airline to adapt and respond more rapidly to changes in the airline transport industry, as well as to focus more time and resources on business growth.

The agreement is worth A$650 million over 10 years and is planned to commence on May 31.

There are two parts to IBM's agreement with Qantas, according to the provider. Firstly, IBM will migrate Qantas' servers to a shared infrastructure at an IBM data center in Sydney, which will enable Qantas to access processing power and storage capacity on an on demand basis. Using a variable pricing model, Qantas will pay only for the computing power it uses, which the airline said has the potential to significantly reduce its IT costs.

Secondly, IBM Global Services will manage a range of services, including service desk support, security and change management, across all of Qantas' IT service providers. Centralizing these services will reduce administration time and other costs for Qantas, IBM said.

According to Brendon Riley, general manager, IBM Global Services Australia and New Zealand, the services arrangement with IBM will give Qantas the ability to scale its infrastructure and staff resources so it can respond more rapidly to customer demands and growth opportunities.

"This agreement will assist Qantas in becoming an on demand enterprise," Riley said. "It is not only IBM's data center infrastructure and variable cost model that will provide increased flexibility and efficiency to Qantas. IBM gives Qantas access to thousands of professionals with an extensive range of skills as well."

He added: "Our relationship with Qantas goes back many decades. We have great respect for the talent, standards and achievements of the Qantas team over this time. This agreement creates a new business model for both Qantas and IBM which will continue to evolve and enhance our relationship over the next decade."