A number of accounting-consulting companies, including PricewaterhouseCoopers, lost or gave up customers after last year's corporate finance scandals, such as Enron's. PricewaterhouseCoopers took the extra step of selling off its consulting services arm to IBM.
IBM, whichPwC Consulting for $3.5 billion in July, launched a campaign to win back customers lost by PwC once it completed the acquisition in October, and the conflicts evaporated, said Ian Colley, an IBM spokesman.
Luring back those customers has helped bolster IBM's Global Services division. IBM Global Services has become the company's third pillar. In January, IBM said that its services revenueby 17 percent in the fourth quarter of 2002, to $10.6 billion--an increase the company attributed to the PwC Consulting buy.
Services deals are often the lead-in for sales of other products that include software and hardware such as PCs and servers.
Since closing the PwC acquisition, IBM has begunits products and creating new services based on PwC Consulting as part of its On Demand computing announced in October.
Through the On Demand initiative, IBM seeks to provide its customers with IT resources, such as computing power and data storage, as a metered service in the same way they might buy electricity.
IBM has announced several billion dollars worth of new deals driven by the On Demand initiative and services that are provided by PwC Consulting.
Among them are a seven-year, $5 billionwith J.P. Morgan Chase and a 10-year, $2 billion outsourcing with auto-parts manufacturer Visteon.