Wipro wins five-year Telefonica Germany/O2 deal

Mobile operator Telefonica Germany/O2 has unveiled a major new five-year contract award to Wipro to transform its business support systems (BSS) and associated quality assurance.
 
The two sides refer to the initiative as a “Radical IT Transformation” (RAITT), which will see Wipro develop a new Business Support platform that will enable the operator to roll out new products and services, such as 5G, to its customer base which covers 44 million mobile users and 2.3 million broadband connections. The value of the deal has not been disclosed but Wipro called it a “high-value and first-of-its-kind engagement in the telecoms space.”

Telefónica / O2 will now set up its IT architecture much more efficiently: The company is reducing the number of IT service providers from ten to two central partners in the future, who will accompany the entire IT transformation and product development process. The number of core IT platforms is being reduced from six to two - one each for the company's private and business customers. This division will enable optimum alignment with the different market requirements and needs of the two customer segments. Instead of its own developed systems, which require a great deal of individual coding, the company will in future rely much more heavily on standardized systems such as those from Salesforce, where changes can be easily incorporated across multiple brands via one user interface. Taken together, these factors ensure that Telefónica / O2 will be able to save up to 30% of the costs of operating its IT applications from 2025 compared to today.

Europe is a major focus area for Wipro following the appointment of former Capgemini executive Thierry Delaporte as CEO at the end of last year. Germany is one of several key Wipro regions in Europe with a new leader, with Michael Seiger joining earlier this month having previously served as global head of application management at Atos.

Germany has been one of the most active markets for major new IT services in the last 12 months, as the country’s businesses push ahead with accelerated digital transformation programmes. Wipro secured a significant deal with retail giant METRO at the end of last year, Deutsche Bank awarded a major contract to TCS to transform its Postbank operation and Infosys and Wipro both secured engagements with automotive giant Daimler that could potentially be worth billions of euros.

Deals such as these are one of the reasons we believe that Germany will be the fastest growing market in terms of IT services expenditure in 2021, with our current expectation that investment will rise by more than 6% this year. Our latest market outlook for all major European countries is available now.