The Norfolk local authority said it hopes that working with a smaller outsourcing company will give it a stronger negotiating position.
Stephen Fennell, the council's head of information and HR, said, "In our experience of outsourcing, one of the central features is the need for some sort of equality in negotiations and bargaining positions.
"We will be a bigger fish in a smaller pond and will gain some competitive advantage out of that."
The contract includes bonuses for over-performance, which can be offset against service credits. The idea of bonuses had been suggested during contract negotiations by Fox IT, which said they had proved successful in other projects.
"They do not generate any extra payments but they can be offset against service credits. They are a positive way of encouraging Fox to over perform," said Fennell.
The council, which has 180 employees, has outsourced its IT for more than 10 years. ICL had the previous five- year contract and reached the shortlist during the contract re-tendering earlier this year.