The Department of Defence will take delivery of 10,000 new desktop computers by the end of June in a deal worth $4.9 million.
A Defence spokesperson said the contract was for the supply of PCs - all from Acer - only and no notebooks were included in the purchase.
"Generally, Defence purchases from the Defence Preferred Computer Systems (DPCS) panel," the spokesperson said, adding that the panel for the supply of PCs consists of Acer, ASI, HP, Ipex, and Optima.
"Acer won the contract based on value for money to the commonwealth."
The spokesperson could not comment on how the new PCs will be used saying only they will become part of the department's fleet of desktops, estimated to number around 125,000.
The new desktop PCs will run Defence's standard operating environment, based on Microsoft Windows, and not the open source Linux environment.
Andy Woo, Gartner hardware and systems analyst, said when looking at a large deal like this it is important to note that the advances in PC hardware technology has outpaced the development of mainstream business applications and operating system software.
"There is a big gap which is why you will see PCs being run up to five years without being refreshed because the enterprise has no compelling reason to upgrade," Woo said. "Depending on the contract, I assume [these PCs] will not be up for tender within the next four years."
Woo said with the PC industry highly commoditized, there is little separation between vendors from a technology perspective and the value proposition now leans towards warranty and support.
"Acer has come a long way over the past five years," he said, adding that the company is still a bit weak in the non-government enterprise market.
"Acer is strong in the education market and has refocused on the consumer market so it's just a matter of time before it gets into the enterprise where the footprint has been dominated by HP, Dell, and IBM."
Woo said Acer is becoming a key player in the Australian PC market and is already the number three vendor. "Acer is knocking on doors but it will take time," he said.
Peter Cullen, Ideas International's global research operations vice president, said upgrade cycles for PC infrastructure have largely been extended in the last five years through diminishing return on investment from new processors and updated software applications.
"Simply put, the historical driver - the demands of newer versions of software such as Microsoft Windows and Microsoft Office - is long gone and it's harder to justify a PC upgrade program based on the need for performance of newer processors," Cullen said. "PC upgrade cycles will continue to be driven by the need for standardization of a software image."