IBM has told O2 Ireland that some functions will be moved offshore if it is awarded the outsourcing contract to manage the mobile operator's technology systems, The Irish Timeshas learned.
O2 yesterday confirmed that it had "entered into exclusive negotiations with IBM" on the contract. The 230 staff who will go to IBM as part of the deal were briefed yesterday.
IBM will take on the management and development of the mobile phone operator's systems and the 230 staff will become IBM employees.
An O2 spokeswoman said the two sides would now negotiate a contract and it was too soon to say how IBM would deliver the contract or from what locations.
An IBM spokesman said the firm was "pleased" to have been selected for the contract. "The exact nature of how it will be delivered will be decided over the coming months," he said. He referred further questions to O2.
It is expected that a contract will be signed between the two firms by the end of the year and that staff would begin working for IBM in the second quarter of next year. IBM was shortlisted ahead of Accenture and Fujitsu.
Earlier this year, it was revealed that, as a result of outsourcing to IBM, up to 900 jobs at Xerox's call centre in Dublin could move offshore.
Call centre jobs have been particularly vulnerable to being sent offshore as they are considered "low value".
IBM will provide support to Xerox's customers from call centres in Scotland, Bulgaria, India and the Philippines and many of its Dublin staff are being offered transfers to those locations.
By contrast, the O2 staff would be highly skilled and it is likely that IBM would only move the more mundane tasks they carry out.
Sources close to the deal said IBM had committed to O2 that it "plans to draw upon the skills within O2 Ireland going forward".
Given the current tight market for skilled IT staff, it is expected that IBM will seek to redeploy any transferring staff who are no longer required to service the O2 contract rather than offer them a redundancy package.
Earlier this year, IBM completed the acquisition of network management company Vallent, which employed 120 people at research and development facilities in Dublin and Galway. In March, the US group announced it was investing €24 million in those technology laboratories which will create 130 jobs over the next three years.
Given this unit largely sells into telecommunications service providers, it is likely O2 staff will be encouraged to apply for these positions.
IBM already has a similar outsourcing arrangement with O2 in the UK and is a major partner of its parent Telefónica in South America.
The O2 spokeswoman confirmed that it was also in exclusive negotiations with Ericsson to take over the management of its network.
