In offshoring we trust: Coonan

Communications and IT Minister Helen Coonan has fuelled speculation government agencies will offshore IT services to cut costs and expressed confidence offshored IT projects will meet strict government IT security criteria.

Speaking at the launch of retail wireless broadband service provider Unwired in Sydney, Coonan said it was inevitable some government IT work would head overseas, and security requirements could be built into such IT services contracts.

"Sometimes you can have agreements that ... provide whatever security. My department is very involved in the security issues that affect Australia - and it’s up to agencies to be confident that if they do offshore any of those particular applications, it won’t be at the risk of broader and more specific security applications ... (The department of communications, information technology and the arts) is critically involved with (the Department of) Defence, the Attorney General and other agencies to make sure we are secure," Coonan said.

Coonan refused to give estimates as to how many government IT jobs may potentially go overseas, nor nominate which areas are likely targets, nor what magnitude of savings the government is looking for.

However the communications minister sought to hose down earlier comments by trade minister Mark Vaile at the launch of a thinktank paper on trade with India, which suggested the government could be making big savings overseas.

"I’ve seen lots of estimates, but I don’t think there’s reliable evidence that would suggest the sorts of numbers that have been bandied around. Obviously it’s a two way street. If you are looking at some sort of net figure, I think that’s a very difficult to thing to estimate," Coonan said.

Telstra’s market dominance also came in for a jibe from Coonan, who joked that almost all Australians would be happy to see Telstra’s near monopoly on so-called last mile copper loop under substantial challenge, particularly in regional areas where the government has allocated $107 million to expedite broadband rollout through its HIBIS program.

Coonan then firmly encouraged Unwired to take advantage of the funding.

Unwired CEO David Spence and CTO Eric Hamilton politely declined initial offers of government capital, and said while they would look at HIBI, they maintained every confidence their new venture can succed without government subsidies. Spence noted Unwired would be heavily targeting the consumer and SME sectors in more densely populated metropolitan areas to woo ADSL customers from Telstra and Optus.

Hamilton said Unwired had provisioned for an intitial 70,000 customers in the Sydney region upon the service going live, adding the firm's greenfields Navini sourced architecture was highly scaleable and bypassed the need for costly retrofits.

Spence said Unwired would also announce a music based alliance with Apple Computer within a month, but refused to speculate whether it would involve iStore.

Wireless VoIP by 2005

Not content in its attempt to syphon revenues from incumbent ADSL providers, Unwired has committed to providing fully interconnected Voice over Internet Protocol services to consumers and SME's within the first half of 2005.

Internal beta tests of the system are understood to be currently underway, with formal user trials commencing in the last quater of 2004. Unwired CTO Eric Hamilton said the VoIP service would provide toll quality calls, with flagged packet based traffic shaping systems from Navini deployed to resolve latency and drop-out issues.

Unwired CEO David Spence said the VoIP offering to customers would include handsets because users wanted to "hear a dail tone", but would not go into specifics as to how the service would be tariffed.

Spence said interconnection fees between other telcos on mobile GSM and PSTN services still remained artificially high and needed to come down more than the three cents per year currently mandated by the Australian Consumer and Competition Commission.

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Julian Bajkowski

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