Cable & Wireless and Compaq have pooled together $500 million in a global deal aimed at delivering ebusiness services and systems to the small and medium enterprise (SME) market.
In a teleconference today, Compaq chief executive Michael Capellas said Cable & Wireless will be the application service provider, supplying SMEs with a "complete end to end ebusiness infrastructure" and Compaq will provide the "enabling technology", including servers, notebooks, desktops, handheld PCs, networks, platforms and services.
"Compaq is contributing $200 million to the relationship," said Capellas. Compaq's participation also includes revenue sharing and traditional supplier contracts, the company said.
The two companies said they plan to commit a total of $500 million over the next five years to the deal, which will kick off worldwide on 1 January, 2000. The companies said the project is aimed initially at SMEs, but will eventually be offered to multi-national companies.
According to Cable & Wireless, in the traditional application service provider (ASP) model, an end user pays a monthly fee to gain access over a network connection to an application that resides in a remote data centre.
Typically ASPs have only offered one or two components of the total service, the company said, leaving end users with the problem of sourcing and integrating offerings from multiple vendors.
Graham Wallace, Cable & Wireless chief executive, commented: "The Internet is currently a best effort network, there are no controls or guarantees," he said. "This move reinforces our strategy to provide business customers with IP solutions that create real competitive advantage."
Wallace said the deal had taken only a few months to complete.
"It's amazing how quickly things can happen when chief executives get behind it," he said.
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