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	May 13, 2008 HP Acquires EDS To Focus On Enterprise IT Services The Deal Gives HP Mega-Deal Credibility by Paul Roehrig, Ph.D. with Christine Ferrusi Ross, Pascal Matzke, Tim Sheedy, Sean Galvin	Average: 8  (5 ratings)

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Executive Summary

Hewlett Packard (HP) sent a shock wave through the IT services industry today by announcing the acquisition of EDS for a reported $13.9 billion. The acquisition creates an IT services powerhouse of tremendous scale and global reach — and leaves outsourcing decision-makers with a different landscape to navigate on the path to successful provider selection. Although HP is clearly planting a flag in the large-deal space, a definitive strategy linking consulting services, systems integration project work, and annuity revenue infrastructure and applications work has yet to emerge, and significant integration challenges remain. Although the scope of the deal is clear, just how many clients will decide that "bigger is better" for their businesses remains the biggest unknown.

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