Mumbai-based software services large-cap Tech Mahindra (TechM) on Thursday announced a strategic and possibly largest-ever deal with leading American network operator AT&T. This deal will accelerate AT&T’s information technology (IT) network application, shared systems modernisation, and movement to the cloud. TechM will assume management of many of the applications which support AT&T’s network and shared systems.
Sources close to the company have confirmed this is the largest deal the company has won to date although deal financials have not been disclosed. The management had earlier confirmed that they expected large communication deals, especially in 5G, to be announced in the second quarter of 2019-20 (FY20). Communication is TechM’s strongest vertical and the company has been extremely positive about a turnaround from the global 5G boom.
The multi-year agreement will enable AT&T to focus on core objectives, including having the most advanced software defined 5G network, and migrate the majority of its non-network workloads to the public cloud by 2024. This comprehensive programme will help drive sustainable operational improvement across the network and software development domains.
Jon Summers, chief information officer, AT&T Communications, said, “Our agreement with TechM is another step forward in delivering greater flexibility across our IT operations. This includes optimising our core operations and modernizing our internal network applications to accelerate innovation as we march forward to our goal of a nationwide 5G network by the first half of 2020. ”
Together, AT&T and TechM aim to improve the agility in rolling out and supporting networks of the future, while improving returns on investment through technology-led transformation. AT&T and TechM will integrate several world-class technologies and platforms in areas like artificial intelligence, DevOps, data analytics, and 5G.
C P Gurnani, managing director and chief executive officer, TechM, said, “This is a step towards elevating TechM’s long-standing strategic relationship with AT&T to help make the vision of a 5G-enabled future, a reality. As part of our TechMNxt charter, TechM is betting big on 5G — network of the future — and is focused on technology-led innovation to enable digital transformation for our customers globally.” The partnership will help to significantly boost AT&T’s 5G time-to-market and simultaneously reduce their cost of ownership by automating aspects of their network lifecycle.
The transformation road map also aims to optimise AT&T’s IT application footprint by aggregating functionality, while optimising business processes, costs, efficiencies, and overall quality. TechM secured $475 million worth of new contracts in the first quarter (Q1) FY20, taking the total in the past 12 months to $1.9 billion, up 67 per cent year-on-year (YoY), according to a report by Maybank Kim Eng. This drove an 8.1 per cent YoY increase in telecom industry (vertical) revenue (42 per cent of overall) in Q1FY20, from a decline of 5.8 per cent in Q1 of 2018-19. Industry analysts are of the opinion that the company can be a strategic stakeholder in the global 5G-related services ecosystem.
As a part of its TechMNxt charter, TechM is focused on leveraging next-gen technologies to cater to the customer’s evolving and dynamic needs. As a leading global digital transformation company, TechM continues to deliver tangible business value and experiences to solve real business problems.