Fujitsu In £500m Post Office Deal

Fujitsu’s five-year deal with the Post Office to provide telephone and broadband services could be worth £500m, according to industry analysts TechMarketView.

The deal, announced on Friday, will see Fujitsu, along with TalkTalk, Capita and billing specialist MDS, taking over from previous service providers BT Wholesale and Logica, which have been the Post Office’s service providers for the past four years.

£500m deal

The deal is expected to be worth £500m in aggregate revenues, with TalkTalk’s share valued more than £100m, according to TechMarketView managing partner Anthony Miller.

Fujitsu is the lead contractor on the deal and will be providing networking infrastructure, with TalkTalk to provide telecoms and broadband services, Capita offering call centre services and MDS providing billing services.

“As prime contractor, Fujitsu will be overseeing the entire migration process, both of the network and of the applications,” Miller said in a research note.

The deal is in line with TalkTalk’s strategy of expanding its business offerings, according to group chief executive Dido Harding, who said the company’s network reaches more than 92 percent of the UK’s population.

TalkTalk’s offerings will include next-generation products such as television delivered over broadband, Fujitsu said. The Post Office has roughly 500,000 subscribers to its telephone and broadband offerings.

Expanded role

Miller said the deal is significant for Fujitsu in that it takes the company beyond the services role it is known for in the UK.

“Fujitsu’s role goes way beyond its ‘traditional’ infrastructure services support homeland,” Miller stated. “This is real ‘up the value chain’ work and very strategic for Fujitsu.”

Last year Fujitsu bolstered its networking infrastructure with a proposed £2 billion superfast fibre network, intended to bypass BT’s street cabinets and offer high speed connections to five million homes in rural Britain that currently have poor broadband coverage. The proposal would create a network to compete with BT’s Openreach division, albeit using BT’s own ducts and poles to carry the fibre.

Earlier this year Fujitsu teamed up with cloud platform vendor ServiceMesh, adding ServiceMesh’s cloud governance, policy management, security and work-flow automation offerings to Fujitsu’s cloud infrastructure.

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