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CSC rings in AT&T services deal

The world's No. 3 computer services company adds a $300 million, ten-year outsourcing contract with AT&T to its recent raft of new deals.

Kim Girard
Kim Girard has written about business and technology for more than a decade, as an editor at CNET News.com, senior writer at Business 2.0 magazine and online writer at Red Herring. As a freelancer, she's written for publications including Fast Company, CIO and Berkeley's Haas School of Business. She also assisted Business Week's Peter Burrows with his 2003 book Backfire, which covered the travails of controversial Hewlett-Packard CEO Carly Fiorina. An avid cook, she's blogged about the joy of cheap wine and thinks about food most days in ways some find obsessive.
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Kim Girard
2 min read
The phone won't quit ringing for Computer Sciences Corporation.

The world's No. 3 computer services company today added a $300 million, ten-year outsourcing contract with AT&T to its recent raft of new deals.

Through the contract, CSC will manage 50 systems that support AT&T Consumer Services. AT&T plans to outsource software systems that provide telemarketing and customer support; provisioning and provisioning support; and compensation and commissions for sales and marketing.

Work on the project is expected to start in March.

Under the agreement, about 100 AT&T employees will be offered positions at El Segundo, California-based CSC. Another 150 AT&T contract employees will transfer to CSC to support the contract. However, all employees chosen to work for CSC will remain at AT&T's seven New Jersey locations where they now work.

AT&T announced plans in October 1997 to outsource its business and consumer operations on which it spends about $230 million per year. At the time, the company said its strategy called for 750 full-time AT&T employees and more than 1,200 consultants to be transferred to and hired by the winning outsourcing vendors.

AT&T's first move was to award, in December, IBM Global the contract to handle computer services for its business division.

CSC started negotiating the consumer contract with AT&T last September and was expected to announce a decision at the beginning of this year.

Earlier this month, CSC also inked a tentative two-year, $200 million deal with vehicle rental company Budget Group and is currently completing negotiations for a $360 million, five-year outsourcing contract with Alcatel, a French telecommunications company.

CSC's chief executive Van Honeycutt last month said the company was on a roll after its December 9 win to modernize the U.S. tax system, a deal reported to be worth at least $3 billion. Honeycutt at the time predicted billions in new deals over the next few months in financial services, aerospace, and utilities industries.

However, CSC recently lost a coveted contract to privatize computer services for the State of Connecticut.

Rival EDS, which lost its bid for the AT&T contract, won the nod to negotiate that landmark $1 billion deal.