Ericsson today signed a Memorandum of Understanding with IBM to outsource to them the development, implementation and maintenance of IT applications supporting Ericsson's business and operations worldwide.

The Memorandum of Understanding establishes the principles of how Ericsson and IBM intend to work together. The final agreement is expected to be signed during Q3 2003.


The intended agreement will include transfer of personnel at Ericsson Process and Application Consulting to IBM.


To outsource development, implementation and maintenance of internal IT applications, also referred to as IS (Information Systems), supporting business and operations  to IBM, is the second step in Ericsson's IS/IT outsourcing process. As a first step, Ericsson on June 4 signed a contract with HP to outsource IT infrastructure.


The decision to outsource the IS/IT operations is part of Ericsson's ongoing changes within the IS/IT area. Ericsson expects to substantially reduce the overall IS/IT cost and achieve greater flexibility in adjusting resources and expertise to meet fluctuations in its business and in the industry.


Ericsson is unable to disclose the financial terms of the agreement.
 
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