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Govt dangles 30-year term as pricing bait for IaaS contracts

Govt dangles 30-year term as pricing bait for IaaS contracts

Government is set to drive a hard bargain in looking for a panel of two or more providers of infrastructure-as-a-service (IaaS) facilities.

A request for proposal issued as the next stage in an exploration of options in “syndicated procurement” of utility computing and housing for datacentre equipment asks prospective providers to “understand the commercial benefits” of contractual relationships lasting up to 30 years when setting their price levels.

However, the RFP is careful to avoid committing government to providing any certain level of ongoing business for the successful provider. “DIA [the Department of Internal Affairs, the government’s lead agency for the project] is unable to give any assurance as to the level of future uptake by eligible agencies, as that is something beyond its control,” the document states.

This follows a lower-than-expected take-up rate from agencies for previous all-of-government ICT projects such as the Government Shared Network, subsequently discontinued – though its successor, one.govt, has been better received.

The RFP asks for utility computing services, defined as services, “on a ‘pay for what you use’ basis that achieves a better match between demand and supply, across the group of participating agencies. This service will include processing and storage.”

“This approach will allow agencies to limit their consumption to their current needs, access up-to-date capabilities that are maintained and upgraded on their behalf as part of the service, receive clear integrated billing information that lets them understand, and if necessary respond to, costs incurred for each deployed agency service and take advantage of erratic or lumpy processing profiles or available unused capacity based on clear price signalling,” the RFP states.

“Over time it is envisaged that the growth in usage of such services will also provide opportunities for reducing the overall cost to government, for example by load orchestration, which are not available through an agency-by-agency approach. A core concept behind this service is the ability to improve relationship between demand and supply.”

Read more on Computerworld.co.nz.


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