HP still in there with Rolls Royce despite losing its exclusivity in March

Back in March I reported about HP losing its big contract with Rolls Royce. This was a contract to provide all of its outsourcing needs, which was won by EDS 12 years ago.

Capgemini was named by Rolls Royce as its service integrator to manage its multi-sourced outsourcing environment. This was a blow to HP, which is attempting to boost its reputation as an IT service provider on the back of EDS’s good name.

It meant that a lot of HP contracts at Rolls Royce could be under threat.

But news today that HP has won a contract renewal from Rolls Royce to host its applications in its datacentres as well as manage the Rolls-Royce remote server and storage environments in Brazil, Canada, France, Germany and Norway, shows that all is not lost.

Robert Morgan, director at sourcing broker Burnt-Oak Partners said at the time of the Roll Royce deal with Capgemini that it did not mean that HP has lost everything but a case of HP  losing the moral high ground.

But he did say it could be the beginning of a gradual reduction in the amount of revenue HP gets from Rolls Royce. He expects perhaps a 30% reduction in HPs revenue with Rolls Royce quite quickly.

Changing datacentre provider would have been a big step. With a highly commoditised service such as this it is difficult to look further than the big players such as HP or Fujitsu. But in other areas, such as the cloud, HP might find it difficult to compete.

HP has not had the best of times with its EDS acquisition. It recently wrote down $8bn from its EDS business, which it acquired for $13.9bn.

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