Rival eyes opportunities from Computerland deal

Rival eyes opportunities from Computerland deal

THE industry’s worst-kept secret was confirmed last week when Telecom announced it acquired Computerland for $26 million, hot on the heels of its June purchase of Gen-i for $62.5 million.

Although the news came as little surprise, it set tongues wagging as to possible outcomes and consequences of the sale, which aims to boost the capabilities of Telecom Advanced Solutions - its IT services arm.

One question was whether jittery customers would decide to abandon Computerland for fear that they would no longer receive the same attention.

Axon account director Simon Goode expects Computerland customers to feel tentative over the merger, saying that creates opportunities for other companies.

“There will be a period while they combine the businesses that they take their eye off the ball and that will be an opportunity for us,” he says.

But others disagree.

Express Data sales boss Paul Plester says he would be surprised if Telecom or Computerland allowed attention to their customers to slide.

“Customers will probably have more contact and coverage than they had in the past.”

Graeme Muller, incoming manager of analyst firm IDC, also does not expect the three companies to falter in their customer service.

“I think they will be very aware of these risks,” he says.

Computerland head Chris Mackay is adamant that the companies’ focus will not stray from customers.

“We do not anticipate losing any customers, we expect to attract more,” he says.

“To do that we have to deliver - the market is a tough audience, so we have to stand up and perform every time.”

The announcement also set the rumour mill in motion around how TelstraClear is likely to respond and whether it too will snap up an IT company, with most speculation pointing to Axon.

TelstraClear is unwilling to discuss its plans.

Spokesperson Mathew Bolland says TelstraClear does not comment on such commercial matters, but it aims to continue expanding the managed services part of the business.

But is Axon for sale?

“Absolutely not,” says Goode.

Muller says Telecom’s acquisitions make it easier for companies, such as Axon, to value themselves.

But whether or not TelstraClear makes a move, all parties agree the sale points to further consolidation in the market.

Consolidation is good for the market as it creates a dynamic environment that leads to growth opportunities, says Muller.

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