Xerox Awards Contract

NEW YORK -- Xerox Corp. has said it has awarded a $3.2 billion contract to Electronic Data Systems Inc. to operate Xerox's worldwide computer and telecommunications network for the next 10 years. Under the agreement, which according to Xerox was understood to be the largest commercial contract of its kind, EDS, which is a unit of General Motors Corporation, will assume responsibility for Xerox data processing, telecommunications and computer network services, the company said in a statement Tuesday. About 1,700 Xerox staff and contractors will transfer to EDS as the computer operations in 19 countries move over to EDS control, a process that will occur in five stages between June 30 and the end of the year, Xerox said. Paul Allaire, the chairman and chief executive of Xerox announced: "This is an important building block in our worldwide imperative to improve productivity and focus resources on our core business of document processing, which is critical to ensure our continued success in a fiercely competitive industry." Experts said the award was a huge boost to the growing computer services, or outsourcing, industry and will fuel more such deals.