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Texas extends IBM's deadline for plan to fix data woes

04:06 PM CST on Friday, November 14, 2008

By ROBERT T. GARRETT / The Dallas Morning News
rtgarrett@dallasnews.com

AUSTIN — Texas’ Department of Information Resources has granted IBM an extra week to say how it will fix serious problems with the state’s newly expanded outsourcing of computer services.

Meanwhile, the department and IBM jointly issued a statement today saying they’ve made progress at backing up critical computer data in major state agencies.

“DIR and the state remain committed to the consolidation effort under the state data center services contract,” said Brian Rawson, Texas’ chief technology officer.

IBM account executive Ken Weiss said, “We look forward to continuing the data consolidation effort with a focus on back-up and recovery.”

IBM still must back up data by Dec. 4, as Mr. Rawson demanded in a letter last week. Although the department gave the vendor another week to formally submit a remedial plan, it didn’t extend a 30-day period, ending Dec. 4, for completing the fixes, said David Duncan, the department’s legislative liaison.

Under the contract, the department could extend the Dec. 4 deadline “if they’re making significant progress,” Mr. Duncan said.

If not, the company risks legal action by the state.

In his Nov. 4 letter, Mr. Rawson said IBM breached its $863 million, seven-year contract by failing to properly back up data, despite repeated state orders to do so.

On Oct. 28, Gov. Rick Perry suspended the transfer of more state records to the IBM data management program, saying network breakdowns and problems with server backups had put more than 20 state agencies in danger.

The actions follow a Dallas Morning News investigation into a record-destroying server crash in the Texas attorney general’s office that prosecutes Medicaid fraud, and concerns that IBM wasn’t backing up critical computer data in state agencies such as the Department of Transportation and the Department of State Health Services.

IBM has already been fined $902,000 for failing to back up data since April 2007, when it took over from Northrop Grumman as the state’s disaster recovery and computer services vendor.

Overall, IBM has been fined $5.4 million. Of that, $2.7 million was for failing to resolve problems quickly and $1.2 million was for server outages. Data backup breaches, missed mail deadlines and taking more than 15 minutes to respond to serious incidents accounted for the rest, department records released this week show.

The contract allows IBM to “earn back” penalties by correcting a service problem within 12 months. Through August, it recouped nearly $440,000 and still had a chance of winning back another $1.2 million, department spokesman Thomas Johnson said.

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