1. OVUM OPINION
Logica's capability in the
utilities industry
Publication Date: November 2011
Author: Stuart Ravens and John Madden
OVUM VIEW
Summary
The following profile was published in Ovum's report Providers Power Up Outsourcing and
Services for Utilities (OI00145-066).
Logica
Success in the utilities industry tends to breed success. Logica’s pedigree within utilities during the
past couple of decades has seen the vendor punch well above its weight in energy, relative to the
size of the overall organization. Logica is not a global player: its utilities revenues are
predominantly derived from its Western Europe heartland and Australia, although it is also
generating revenues in North America and South America (particularly Brazil). Although it has a
flagship outsourcing client in Portugal’s EDP, whether Logica will win many more large-scale
outsourcing deals or major systems integration work remains an open question.
However, Logica appears poised for success in managing the huge volumes of data that will be
created by smart energy projects. Although it is far from alone in targeting the exponential growth
of data in utilities, Logica’s experience building and operating many central market systems puts it
in a unique position. Early indications suggest that European utilities are buying in to Logica’s
value proposition – a good sign for its future success.
At a time when major outsourcing in the utilities industry was a relatively rare occurrence, Logica
won what remains one of its largest customers: the Portuguese utility EDP. EDP had already
moved all of its IT businesses into a subsidiary Edinfor, which was subsequently acquired by
Logica's capability in the utilities industry © Ovum (Published 11/2011) Page 1
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2. Logica. The Logica/EDP relationship remains strong: Logica helped build the IT infrastructure that
manages EDP’s wind farm assets. Logica is also closely involved in InovGrid, EDP’s smart
metering project.
Despite the good relationship Logica has grown with EDP, it has so far failed to replicate its
success by winning large-scale, full-service outsourcing contracts within the utilities space.
Although there are few available contracts to win, it is unclear if Logica has the ability to secure
these kinds of deals with tier-1 European utilities. That said, Logica has an impressive track record
in the utilities space, and its unique market experiences places it in a strong position to grow
through smart energy services. Where most organizations fall short in terms of relevant, industry-
specific experience, up until recently Logica’s problem was that it failed to gather its market leading
experience and create a single, coherent message. It appears that Logica has turned this
particular corner and has the right leadership to successfully take a number of energy and
sustainability services to market. Logica’s smart utilities portfolio pulls together its experience
within retail, networks, and central markets, and how this all dovetails together.
It comes as no surprise to learn that Logica has been the go-to service provider for five of the UK’s
big-six utilities’ smart meter rollouts. Logica also runs a data hub in Sweden. In addition, it is the IT
provider to e-laad in the Netherlands, a centralized clearing house created by Dutch DNOs that
allows roaming billing for EV recharging.
Despite its experience, Logica is trying to ensure that its reach does not exceed its grasp when it
comes to securing new contracts. There is no better example than its strategy to win work from the
Data Communications Company (DCC). The DCC is a regulator-mandated communications hub
that will manage all of the data transmitted by the 50 million smart meters to be deployed in the UK
by 2020. Many organizations have eyed the potential opportunities that the DCC presents. Most –
for example, IBM and Cable & Wireless – are pitching for a full-scale data and communications
solution. Logica, however, is aiming for just the data management element of the piece. Logica is
displaying a maturity in its smart grid strategy that is testament to its understanding of both the
industry and the areas it can reasonably service. Purpose of these sections: Key steps for our
clients to consider - and the opportunity to put forward your own views of the impact of the
research findings or the market event. If possible, further analysis of the research conducted would
make the foundation of any opinion stronger.
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3. APPENDIX
Disclaimer
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incorrect.
Logica's capability in the utilities industry © Ovum (Published 11/2011) Page 3
This report is a licensed product and is not to be photocopied