Dell dumped by Australian regional government

Dell will be unable to supply desktop PCs to NSW Government agencies for at least three years under the state’s newly announced whole-of-government supplier panel.

The multinationals list now consists of Acer, Lenovo and HP. Dell, which retained a place on the original panel and had submitted a bid under the new tender, has not been successful this time around. Two local assemblers, ASI Solutions and Optima, were also awarded spots on the locals-only list.

The desktop PC, notebook and server panel covers about 280,000 machines and is expected to be worth A$175 million (US$143 million) annually. The contract was due to come into effect in April last year but was delayed. Over 30 panel applications were received by NSW Department of Commerce for Contract 2000.

The notebook and server components have not yet been finalized.

The new arrangement replaces the ITS2000 panel, which has been in place since 2000. Contract 2000 will run for three years, with two 12-month extension options. It is understood panelists who have not been successful with their initial tender have a right to appeal the decision.

For the first time, NSW Commerce introduced a locals-only desktop PC list to sit alongside the multinationals panel. While the main panel was restricted to four players, the government said it would not set a limit on how many locals could participate. Under the arrangement, up to 20 per cent of desktop PC sales could be allotted to local manufacturers. It is still unclear how this breakdown will be monitored.

A Dell spokesperson said the NSW Government’s decision went against its other government relations across the country.

“This is in contrast to what is happening in business and government elsewhere in Australia, where Dell has been rapidly growing its market share,” the spokesperson said.

According to a statement from NSW Commerce, the new arrangement will save the state about A$120 million over the four-year lifecycle of PCs.

“This agreement means Government agencies will no longer need to negotiate separately with individual suppliers,” NSW Minister for Commerce, Eric Roozendaal, said in the statement. The new contract was also the first to introduce requirements for asset disposal, he said.

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