EDS wins British defense deal

EDS Corp. has won its largest contract since 2002 ? a $4 billion award from the British defense ministry ? but controversy may be brewing among British political conservatives critical of EDS' past performance with IT systems.

The United Kingdom's Ministry of Defense announced March 2 that Atlas Consortium, led by EDS, was selected as the contractor for the first phase of the Defense Information Infrastructure Future project to consolidate information networks into a single infrastructure. The estimated value of the first-phase contract is $4 billion over 10 years, which is EDS' largest contract in three years, according to the company.

Other consortium members include Fujitsu Services of London, EADS Defense and Security Systems of South Wales, General Dynamics Corp. of Falls Church, Va., and LogicaCMG of London. The contract is expected to become final within 30 days, and work is to begin in April, EDS officials said in a press release.

Initially, DII Future will provide a fully networked and managed service to roughly 70,000 desktops around the world, the U.K. Defence Communication Services Agency said in a press release.

"This group of companies has international experience of delivery of first-class IT systems," Lord Bach, minister for Defence Procurement, said in the release. "We are particularly pleased that, once awarded, this contract will sustain more than 2,000 jobs in the IT sector in the United Kingdom."

However, Gerald Howarth, a spokesman for the Conservative Party on defense issues, said the choice of EDS is questionable because of the company's past problems with a large contract with the British government's Inland Revenue agency, among others.

"Past experience of EDS and government IT contracts does not bode well for the Ministry of Defence," Howarth said in a statement. "EDS has been involved in major problems in the IT systems of other government departments, at a cost to the British taxpayer of millions of pounds."

Tories are calling on the government to halt the contract award until government auditors can examine EDS' past performance in IT projects, the Financial Times reported today.

About the Author

Alice Lipowicz is a staff writer covering government 2.0, homeland security and other IT policies for Federal Computer Week.

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