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By Stan Gibson  |  Posted 2004-08-16 Print this article Print

When talk turns to large, long-term deals, the Navy Marine Corps intranet contract with EDS inevitably comes up. After the first seven years, the contract calls for an optional extension of three years. But to continue as the outsourcing provider, a contract provision calls for EDS to cut its charges to the Navy by 15 percent. Capt. Chris Christopher, deputy director of the NMCI office, told me that figure was estimated based on anticipated technology improvements that would lead to greater efficiency and therefore lower costs, a sort of Moores Law factor, if you will. But based on reports of how much money EDS is losing on the deal, its difficult to imagine the giant integrator will be able to match that figure.

Click here to read why all eyes are on Navy Marine Corps intranet project.
Christopher said hes looking forward to a time when the Navy will be able to compare the known performance of EDS with bids from other providers. As it is, he cannot compare EDS performance with that of the Navy before the contract—IT governance was that chaotic.

As far as EDS is concerned, the company is trying to make the best of a bad situation. Earlier this month, the company announced it will consolidate and host several legacy Navy applications from an EDS-run facility. This will lower EDS costs considerably because the contract requirement that it take over and run those legacy applications had apparently been a huge cash drain for EDS.

So far, the NMCI-EDS contract is showing that if your hands are tied, a little flexibility can go a long way.

Out and about

The U.S. National Archives and Records Administration is building an electronic archive and has selected two companies, Lockheed Martin and Harris, to compete for the final design. A year from now, the National Archives will select the winner to build the Electronic Records Archives, which will capture electronic information regardless of its format and save it permanently. Lockheed Martin will be paid $9.5 million for its work in the competition, and Harris will be paid $10.6 million.

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Stan Gibson is Executive Editor of eWEEK. In addition to taking part in Ziff Davis eSeminars and taking charge of special editorial projects, his columns and editorials appear regularly in both the print and online editions of eWEEK. He is chairman of eWEEK's Editorial Board, which received the 1999 Jesse H. Neal Award of the American Business Press. In ten years at eWEEK, Gibson has served eWEEK (formerly PC Week) as Executive Editor/eBiz Strategies, Deputy News Editor, Networking Editor, Assignment Editor and Department Editor. His Webcast program, 'Take Down,' appeared on He has appeared on many radio and television programs including TechTV, CNBC, PBS, WBZ-Boston, WEVD New York and New England Cable News. Gibson has appeared as keynoter at many conferences, including CAMP Expo, Society for Information Management, and the Technology Managers Forum. A 19-year veteran covering information technology, he was previously News Editor at Communications Week and was Software Editor and Systems Editor at Computerworld.

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