The NHS National Programme for IT and EDS have agreed to part ways on the NHS email and directory service project, with Cable and Wireless picking up the contract.
The NHS and EDS separation has taken place "without any attribution of blame to either party", according to the National Programme for IT.
However, in an earlier statement, issued when mediators were called in to settle the differences between the two, the NHS National Programme for IT said: "EDS' delivery of the contract has been the subject of ongoing concerns including unacceptable delivery delays, issues in the functionality of the services and service capacity."
It also stated that there had been a lower take-up of the services than hoped for.
C&W has stepped in to the breach to manage the email and directory services. The contract will run for nine years and is worth between £50m and £90m to the communications company. EDS carry on supplying running the email directory until C&W can take over without any interruption to the running of the service occurring.
The email and directory services are accessible by all NHS users and provide a database of all email addresses for the NHS, as well as managing the addresses themselves, and SMS and calendar functions.