By Tony Hallett, 2 March 2005 11:30
NEWS The EDS-led Atlas consortium has won the £4bn Ministry of Defence (MoD) Defence Information Infrastructure (DII) outsourcing contract, one of the biggest outsourcing deals ever.
The Atlas consortium beat off the CSC-led Radii grouping. The latter comprised three well-known IT companies - BT and Thales as well as CSC - versus the six partners working with EDS.
Speaking at a press conference held at MoD headquarters in London today, a senior MoD official said the department is confident all the companies in the Atlas consortium will perform well. Besides EDS, Atlas includes Cogent, Fujitsu Services, General Dynamics and LogicaCMG as well as HP and IBM who were at one stage in separate competing consortia.
Well-documented failings by EDS at the Inland Revenue and Department for Work and Pensions meant that until recently Radii had been many industry watchers' favourite to win the giant DII contract. However, the MoD spokesman said due diligence had been done at reference sites at home and overseas and the department is confident past mistakes won't be repeated.
A senior consortium member said Atlas members are "obviously delighted that the prolonged effort" had ended with today's result, which had been tipped at the weekend.
A consortium led by Lockheed Martin of the US withdrew from the process last year but the Atlas spokesman said the DII cost "is commercially viable" and called the procurement process "realistic".
The fact that the two remaining consortia bids were both solid was emphasised by Government CIO Ian Watmore.
"The second-placed consortium was also very strong and would have made a good winner too," he said. "[There were] two very strong horses at the finish line."
Ahead of today's announcement, the National Outsourcing Association said that an Atlas win would do a lot to "polish up EDS' public sector image".
Features of the DII contract include replacing disparate legacy systems, interoperability across all the armed forces, access to new applications and - perhaps most importantly - no single point of failure, including transferral of roles of suppliers should one fail in a certain area.
Today saw Increment 1 of the DII awarded, accounting for around £2.3bn of the £4bn, 10-year deal, though it is expected Atlas will also end up winning Increments 2 and 3.
CSC, while riding high on a wave of large outsourcing and other IT services deals, isn't known for experience within UK defence.
CSC would not comment on the reasons why it was not chosen but said in a statement today: 'We are naturally disappointed not to be selected for this phase of the DII contract, but we do realise that we have been involved in a very competitive selection process."
Comments
There are 6 comments. Join the discussion
1. Dick Winchester
How depressing. Once again the UK content of a major MoD contract is virtually nil. With friends like the UK Government British companies don't need any enemies.
2. David J Walker
Oh great EDS again. Do we never learn?
However, I expect someone's Swiss bank account must be benefitting from it, and that's the main thing, after all.
I really can't see why anyone would hire EDS to program a simple telephone number database otherwise.
We'll just have to hope we don't get invaded by Lichtenstein any time soon.
3. anonymous
Best hope EDS don't bugger this one up !
4. Anon
The majority of IT projects has problems and most have scope creep. EDS is not the only IT company to experience this. However, as they are high profile due to the nature and type of projects they get it seems like EDS is the only company in the world to experience issue. Maybe ill informed people should try working on a project with lazy civil servants who don't want IT as it will track their lack of performance and go off sick for six weeks at a time when asked to UAT systems and change their requirements more times than they change their underwear.
5. Nigel Kemp
When is this government going to learn. They still haven't sorted out the CSA failures of EDS and give the largest government contract in years to a company proven not to deliver.
6. Kevin Toms
To the ill informed...
EDS employs a significant number of staff in the UK. OK, its an American company, but with lots of UK staff. If you don't like this then stop shopping at Asda.
EDS has a track record of success. Thing is, that doesn't suit the press, so any failure is spun into the latest great disaster. EDS left the IR on perfectly good terms, and lost the contract not because of failings but, in my opinion, political expediency.