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Ericsson signs 5-year IT outsourcing deal with HP

Ericsson signs 5-year IT outsourcing deal with HP

Telefonaktiebolaget LM Ericsson has announced the signing of a five-year IT outsourcing deal with HP.

The agreement makes good on a memorandum of understanding the two companies signed in April.

Under the terms of the contract, HP will take over responsibility for Ericsson's IT infrastructure in 100 countries, standardise the company's desktop environment and provide data center management and help desk support, vice-president, HP Services, Juergen Rottler, said.

He said that beginning next month, 1000 employees of Ericsson's Global IT Services division, as well as certain assets, would be transferred to HP.

The deal is still subject to regulatory approval.

Although the companies were not releasing financial details, Rottler said the contract was the largest outsourcing deal in Sweden's history.

Ericsson's headquarters are in Stockholm.

However, Rottler said HP would not take over Ericsson's information systems operations. They include application development, implementation and management.

"Outsourcing of IT operations is part of Ericsson's ongoing changes within the IS/IT area and its overall restructuring program (which is aimed) at radically reducing the operating expenses and cost of sales," Ericsson's Deputy CEO, said Per-Arne Sandstrom, said.

"This is a big win for HP," Rottler said. "It adds to our credibility, and it will add to our bottom line in the first year of the (contract)."

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