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Story URL: http://www.silicon.com/research/specialreports/enterprise/0,3800003425,39122997,00.htm

BSkyB to sue EDS over £60m CRM contract
But EDS hits back…

By Andy McCue

Published: Monday 09 August 2004

British Sky Broadcasting (BSkyB) is set to sue EDS over a problematic £60m contract for a customer relationship management (CRM) system that the IT services company terminated in December 2002.

EDS won the contract for the system to help BSkyB handle call centre inquiries in 2000 but pulled out and handed the work back to Sky to complete in-house because of significant changes to the scope and business transformation requirements.

A year and a half later and BSkyB is still working on the CRM system after investing £170m since 2000, and committing to a further £50m in the next few years.

The details were revealed in BSkyB's annual results report last week, which said: "The group anticipates issuing and serving a claim in the near future for a material amount against an information and technology solutions provider, which had provided services to the group as part of the group's investment in CRM software and infrastructure."

BSkyB did not say how much it is seeking to recover, although it is expected to be something similar to the total contract price of the EDS deal.

A spokesman for EDS questioned the timing and motives of BSkyB's announcement. "We can't understand why BSkyB has chosen to bring it out into the public now and we're very disappointed that BSkyB has chosen to highlight this one and a half years after we terminated the contract," he told silicon.com. "We'll vigorously defend any action BSkyB may take."