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IBM Edges Out HP on $500M Nestle Deal

By @NY Staff

International Business Machines edged out tech rival Hewlett-Packard to win a five-year, $500 million contract with Swiss food conglomerate Nestle.

The contract calls for IBM to help Nestle consolidate its global network of operations into five data centers, in what is seen as a win over HP, a longtime supplier of consulting services and servers to the company. Nestle's data centers will use IBM's eServers, including the pSeries Unix servers and xSeries Intel servers.

In addition, IBM's Enterprise Storage Servers (otherwise known as their code name "Shark") will be part of the mix with storage area networks, DB2 software and Tivoli software.

The contract win comes as Nestle, the world's largest food and beverages company, gears up to streamline its business processes, a project that encompasses factories and operations in 84 countries. The goal is to save about $1.8 billion by 2006 for the company, which takes in annual sales of about $50 billion.

The job involves a major commitment to SAP's mySAP.com software. With over 237,000 employees worldwide, Nestle is one of the German database software company's largest customers.

IBM's role is to help all the Nestle employees access the same information via an internal "mySAP.com" portal, specially customized for each employee's responsibilities.

The regional data centers for Nestle will be located in Sydney (Australia), Phoenix, Arizona (USA), and in Frankfurt (Germany), plus two in Switzerland, where Nestle's GLOBE project of streamlining operations is headquartered.