BSkyB's sues IT provider EDS

MUMBAI: British pay TV broadcaster BSkyB has filed a legal claim alleging "deceit, negligent misrepresentation and breach of contract" against US-based IT provider Electronic Data Systems (EDS).

The suit concerns an EDS contract to build and implement a customer call centre for Sky which was terminated in 2002. BSkyB CEO James Murdoch had signalled that the company was planning legal action against an IT provider when it unveiled annual results earlier this month.

A report in The Herald indicates that BSkyB had hired EDS four years ago in a deal worth around £61m over two years, to design and operate computer systems to handle inquiries at call centres across the UK.

The contract, which covered software, technical infrastructure, systems integration and refurbishment, was axed after BSkyB became convinced the system would not be delivered as agreed. In a statement to the London Stock Exchange, BSkyB said it was taking the action after EDS "failed to perform its contractual obligations".

The broadcaster took over sole responsibility for development of the system and has invested more than £170m since the middle of 2000. Another £50m is expected to be invested over the next four years as the computer system goes into full operation.

However, in a Guardian report, EDS stated that it had terminated the contract two years ago because Sky repeatedly changed its requirements. 

An EDS spokesperson added, "We will defend this absolutely. The language they have used is really inflammatory and any analysis of what EDS undertook some four years ago will show that EDS behaved absolutely properly."

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