RealTime IT News

EDS Touts Smaller Pacts, Changes Unit Name

IT services company EDS , itself no stranger to billion-dollar "megadeal" outsourcing contracts, is taking a "smaller is better" approach with a string of business process outsourcing contracts collectively valued at $117 million.

The business process outsourcing (BPO) services are for clients across multiple industries and geographies, and will be served by a newly-named unit called EDS Business Process Services, the company said. The unit is expected to house a range of skills, business processes and IT services from across EDS's operating divisions.

EDS, which provides outsourcing and computer services to some of the world's largest companies and government agencies, has indicated in recent months that it is focusing on smaller contracts alongside the outsourcing "megadeals" whose contract value often rate in the billions. The Plano, Texas, company has recently run into contract delays on a handful of its major outsourcing contracts, including a $6 billion IT services pact with the U.S. Navy, that have chewed into its cash flow.

The latest BPO agreements include a multi-year contract extension with Dow Chemical to help the company manage its customer relationship management call centers, extending those services to its Dow Retiree Service Center. EDS has helped the company manage its call center operations since 1994.

Another pact involves a six-year contract with Wanadoo, France Telecom's Internet division, in which EDS is expected to supply CRM contact center services to Wanadoo's Spanish subsidiary. The unit is ramping up its response to customers seeking high-speed Internet services.

Lastly, EDS is slated to provide payment and settlement services to Dobson Cellular System's American Cellular Wireless venture with AT&T Wireless. EDS, which already provides electronic payment services to Dobson, will be providing continuous settlement services in the four-year pact.

According to IDC, the market for BPO services is estimated to be worth about $177 billion currently and is expected to grow at a compound annual growth rate of 9 to 11 percent through 2005.