The Isle of Man Government has renegotiated and extended its major contract with Manx Telecom plc for the provision of telecommunications and network services.
 
The Cabinet Office says the new contract will generate significant cost savings, recognise the expertise and capability in Manx Telecom's core services, and optimise the opportunity for competitive tenders where competition exists in the future.
 
The wide ranging contract covers six separate lots which were successfully won by Manx Telecom in 2009 through an extensive competitive tender process. It includes services such as wide area networks connecting over 220 sites across the Island, local area networks providing infrastructure to over 5,500 end customers, mobile services to over 3,000 handsets as well as other fixed line telecoms and internet based services.
 
The original tender process recognised that the telecoms market would continue to evolve over the period and more quickly in some areas than in others.  Consequently the original process and Treasury concurrence provided for the contract to be extended for a further period of up to five years or until such a time that the market provided the opportunity for a new competitive process to occur.
 
Following a lengthy period of market analysis coupled with formal and informal assessment with Manx Telecom and other market providers, the mobile and fixed line services have been extended for a period of up to two years.  Manx Telecom’s contract for the remaining services has been extended for a period of up to five years.
 
Mark Lewin is Director of Government Technology Services which has responsibility for the management and oversight of telecommunications services. He explained: ‘This is a major contract allowing us to provide cost effective integrated IT systems across the whole of Isle of Man Government and we are pleased to have completed the negotiations with Manx Telecom.
 
‘Through this process we have been able to protect the critical services and importantly secure significant cost savings in a number of areas.    We have continued the process of broader competitive dialogue where possible which in this case resulted in one of the smaller components in the contract being awarded to another provider. The contract now gives us the ability to take advantage of new technologies which will in time open up further cost saving opportunities.’
 
Mr Lewin added:

‘Manx Telecom is a strategic partner with a significant amount of depth and breadth in communications services, helping to ensure the Island has a world class telecoms infrastructure.  Some critical services are only currently available through Manx Telecom and the original contract recognised this, allowing for the extension of individual components as required. The contract has therefore been extended in line with this provision but with varying terms reflecting our view of market development.  We look forward to carrying on our work with Manx Telecom and we will continue to watch how the market and the underlying technologies evolve.
 
There will now be a full tender for mobile and fixed line services within the next two years and for the other services within the next five years as and when the market is optimised for further competitive tendering’.
 
Mike Dee, CEO of Manx Telecom, said,

“We are delighted that Manx Telecom remains so integral to Isle of Man plc through our Government partnership. In particular the Government highlighted the value of our recently launched 4G service, which will allow them to continue their efficiency drive by pursuing their mobile working initiatives.  The Government remains our single biggest customer and we look forward to this new phase of our partnership”