Posted on 29-8-2002

Telstra Eyes Linux Open Source
By Michael Sainsbury, iTnews, Wednesday, 21 August 2002

Telstra will explore using the open source Linux OS as part of a new
standard operating platform being scoped by the telecommunications giant as
it looks to reduce its $1.5 billion annual IT budget. Telstra Retail CIO
John Pittard said that while Telstra was not using Linux at present, it was
considering the OS in its wide ranging IT review that will dictate the
future direction of operating platforms supporting Telstra's 45,000 desktops.

Such a move could see Microsoft further sidelined at its biggest Australian
customer, following a recent deal with Sun Microsystems that will see Java
2 used as Telstra's web services platform, as well as revelations that
Telstra is considering Sun's StarOffice desktop application suite as a
possible replacement for Microsoft Office on some or all of its 45,000
desktops. Telstra has said it has conducted its review in the context of
existing suppliers. And a number of Telstra's existing technology partners
- IBM, HP and Sun are all pushing Linux as an alternative to Windows for a
corporate IT environment. A Telstra spokesperson said that Telstra's IT
spend under corporate CIO Jeff Smith is between $1.3 and $1.5 billion.
Pittard said one of the main criteria used in selecting Sun for the web
services deal was "the total cost of ownership over five or six years."
Other short listed hopefuls for that deal are believed to have been
Microsoft and IBM.

Telstra has been shrinking its capital expenditure budget by 20 percent a
year over the past two years, and with IT accounting for around a third of
this spend, its systems have come under close scrutiny from corporate CIO
Smith who has been at the company less that a year. Smith has spoken
publicly on a number of occasion about his preference for open standards
and systems and listed Sun boss Scott McNealy as his most admired IT figure
in a recent magazine interview.

After a long hibernation in the Australasian business and government
market, Linux has made some headline wins recently with the Federal
Department of Veterans Affairs planning a large scale Linux roll out and
Air New Zealand also opting to use the open source OS.