Outsourcing megadeals chill out, but why?

Summary:Is JPMorgan Chase's cancellation of a $5 billion contract with IBM a sign that technology services megadeals are going the way of the dinosaur? Other billion-dollar agreements have unraveled recently: EDS and Dow Chemical "mutually" terminated a contract valued at $1.

Is JPMorgan Chase's cancellation of a $5 billion contract with IBM a sign that technology services megadeals are going the way of the dinosaur? Other billion-dollar agreements have unraveled recently: EDS and Dow Chemical "mutually" terminated a contract valued at $1.4 billion. Analysts expect smaller deals to become more common, with a push for lower pricing being partly behind the shift. Breaking outsourcing tasks into smaller deals means that more companies are capable of doing the work and providing a bid. But what's the driving force behind the push for lower pricing?

Topics: Outsourcing

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David Berlind was fomerly the executive editor of ZDNet. David holds a BBA in Computer Information Systems. Prior to becoming a tech journalist in 1991, David was an IT manager.

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