IBM will have nearly 200 research & development staff in Perth generating annual exports of $25 million following the global computing giant’s acquisition of United States software company Micromuse Inc.
IBM will have nearly 200 research & development staff in Perth generating annual exports of $25 million following the global computing giant’s acquisition of United States software company Micromuse Inc.
The Micromuse deal has a strong West Australian flavour, following its earlier acquisition of Perth company Network Harmoni, which is one of the unsung success stories of WA’s information technology industry.
Founded in 1996 by Curtin University graduates Mike Schulze and Craig Farrell, Network Harmoni built a strong niche in the global IT industry after gaining backing from a private investor in the United States.
Its success was reflected in the 2003 sale of the business to Micromuse for $A34 million in cash.
Micromuse retained the Perth office as one of its main R&D laboratories and it currently employs just over 40 staff here.
They will add to the 145 R&D staff IBM currently employs in its Australian programming centre in West Perth, which is one of only a handful of IBM research centres globally focused on mainframe technologies.
Together, the IBM and Micromuse research labs constitute a little known but significant plank in Western Australia’s IT sector.
IBM’s Australian programming centre evolved from an earlier IBM software development support centre that commenced in response to the state government’s offsets programme in 1986.
The West Perth centre also benefited from a $1.9 million state government grant in 2001, which was provided in return for the company increasing its staff numbers from 92 people to 176 people over a period of five years.
Steven Worrall, IBM’s Australia and New Zealand software group general manager, said most of the work at the West Perth lab was for other parts of IBM but it had to compete for its contracts.
Mr Worrall said the Perth centre had generated $100 million in exports over the past five years and he expected the annual total to hit $25 million.
“We are very proud of the investment in Perth,” he said.
Mr Worrall said the Perth centre had to offer competitive prices in order to win research contracts but it also sought to differentiate itself on the skills of its people.
“The majority of the work is of such a specialised nature that we have been able to retain our competitive edge,” he said.
Mr Worrall said Perth’s lifestyle continued to be a key selling point in attracting staff.
“We’ve been able to attract some very talented people into that environment,” he said.
Meanwhile, Mr Worrall said IBM’s US$865 million acquisition of Micromuse would enable the two companies to build on the work they have done together over recent years.
It would enable IBM to integrate Micromuse’s network management software into its Tivoli software.
Mr Schulze, who heads up Micromuse’s development activities in Perth, said IBM and Micromuse had a “tremendous set of complementary skills” and the combination would deliver enormous opportunities.
He also noted the “very deep talent pool” flowing out of WA’s universities, which had met most of the recruitment needs of Micromuse and its predecessor Network Harmoni.
“We haven’t seen a need to go aggressively beyond the WA market,” he said.
Mr Schulze’s co-founder, Craig Farrell, has taken a different career path.
He moved to the United States in 1999 to lead the development of Network Harmoni, and subsequently became chief technology officer at Micromuse.
He now works inside IBM’s Tivoli business unit in the United States.
