IBM wins $1.4bn deal

IBM has secured a $1.4 billion outsourcing deal to provide technology services to Anglo-Swedish pharmaceutical company AstraZeneca, reports Information Week.

IBM will provide IT infrastructure management services to AstraZeneca locations in 60 countries. The services will include server and storage hosting, desktop management, network maintenance and management, and help desk support.

The deal will let AstraZeneca "focus its efforts on adding value to its scientific, commercial and supply operations, thereby helping the company to deliver more medicines that make a meaningful difference to patients", said Richard Williams, CIO of AstraZeneca.

A 25% drop in new contracts and a 17% decline in restructured contracts indicated 2007 could be a slow year for global outsourcing companies, reports Computer World.

Researchers at TPI recently released its TPI Index analysis of the global outsourcing market for the second quarter, and the found that deals have dropped considerably when compared to the same time last year.

To start, one-quarter fewer deals have been signed midway through the year than in 2006, and the average total contract value of deals so far in 2007 is about 34% less than deals from the same time last year.

India's stronghold on the shared services and outsourcing (SSO) sector, once fuelled by low-wage skilled workers, is now being challenged by other countries in the region, such as China and Malaysia, according to a new study by Frost & Sullivan, reports Business Week.

Culled from interviews with 338 Fortune 500 and Forbes 200 companies, the survey found that structural factors such as low labour costs and abundant supply of relevant skills, helped ensure India remained the top destination for SSO activities.

However, the study noted, India is facing increasing threat from other countries in the region due to several factors. These include India's high attrition rates, poor infrastructure, rising wages and the appreciation of the Indian rupee against the US dollar.

CIBER has won a $5 million contract extension to provide IT outsourcing services to Nashville Electric Service (NES). NES is one of the 11 largest public utilities in the US, which delivers energy to approximately 350 000 customers in middle Tennessee, reports CNN Money.

The multimillion dollar win is an extension of CIBER's three-year IT outsourcing engagement with NES, which CIBER began in October 2004. The total value of the contract to date, including the newly won extension, is $18 million.

"We have worked with CIBER since October 2004, and have been very pleased with CIBER's partnership approach and strong delivery capabilities," said Vic Hatridge, CIO of NES. "CIBER provides reliable, efficient, cost-effective information technology services to NES. This allows us to focus on our core mission of providing reliable power to our customers, without worrying about internal IT issues."