US IT firm Unisys is to close two of its data centers in New Zealand by the end of next year.

IDG’s Reseller News reports that the Pennsylvania-based IT company plans to close its Kapiti and Auckland data centers by November 2022.

“As new technologies evolve, so does our company," the company told Reseller News. “The successful growth and maturity of infrastructure and application hybrid cloud services, as well as higher density infrastructure technology, has created a significant shift in data center housing services requirements.

“This means that it is no longer a strategic intention, or viable, for Unisys to have its own data center facilities in New Zealand.”

In lieu of its own facilities, Unisys will house clients' infrastructure via colocation agreements with data center providers within and beyond New Zealand.

“This move aligns with Unisys global strategy to focus on, and invest in, delivering a full suite of cloud managed services and data center management capabilities to help New Zealand organizations reduce costs and gain efficiencies, flexibility, and scalability.”

New Zealand’s Inland Revenue Department is a major customer of Unisys in the country, with the company awarded four contracts over the four years to June 2020, worth a total of NZ$32.5 million (US$22.6 million).

IRD’s deputy commissioner of transformation, Greg James, warned of the potential risks the migration poses last November.

“The top three risks for transformation relate to the need to move off all our heritage applications by 1 July 2022, so that we can fully decommission our heritage data centers,” he said.

“Failing to exit the Unisys data centers by the contracted date has financial consequences but, more importantly, Unisys is exiting this business, handing the facilities back to the owners, and removing all technology hardware. The date that we have been given is a hard deadline with only limited leeway.”

The IRD is undergoing a digital transformation to move its on-premise applications either to the cloud or out of the legacy data centers into other facilities. In March, after potential vendors said they could not confidently confirm their ability to implement a replacement solution before the exit, the IRD canceled the tender and said moving its existing payroll application to a cloud-based solution provided by SAP is the most viable approach.