HP Rolls Up EDS

Oracle has enjoyed considerable success by rolling up the software side of the the now-mature client-server model of corporate computing. With its $13.9 billion acquisition of sluggish outsourcing giant EDS, Hewlett-Packard is playing the same game on the services side. It’s buying vast tracts of data-center space in which run the computers and other IT machinery that power the operations of lots of large companies and government agencies. The addition of EDS more than doubles the size of HP’s services business, giving it a scale closer to that of the leading IT outsourcing company, IBM.

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