Electronic Data Systems said Friday it has signed $445 million in new business by extending IT outsourcing contracts with three customers. Under a contract with the State of Arkansas, EDS will help the state bring its Medicaid management information system into compliance with federal medical privacy laws. The company extended a contract with BellSouth Technology Group that it signed in 1997 and renewed for three years a contract with Main Street Direct, a direct marketing company.
IT outsourcing, a lucrative and growing market in the largely dismal technology industry, often involves the outsourcing of large corporate data centers, IT help desks and application development to a third party service company, such as EDS or IBM. Companies purport to save millions of dollars by handing off IT functions to companies that specialize in such tasks.