Sun Microsystems and Electronic Data Systems Corp. (EDS) announced Monday a comarketing agreement that they estimate will generate US$3 billion in sales over the next five years.
As part of the "Sun-EDS Continuum of Services" program, Sun will provide hardware, software and architecture while EDS will provide services such as systems implementation, integration, consulting and outsourcing, said EDS spokesman Peter Rowe.
"We performed a joint review and looked at how the companies had performed historically to come up with the projected revenue. It's important to note that $3 billion is an incremental figure and is above and beyond existing levels of revenue for both companies," Rowe said.
Both Sun and EDS reported yearly revenue of $19.2 billion for 2000, Sun and EDS said in a statement.
Financial terms for the deal would not be released, Rowe said, though he added that the deal was not exclusive.
The joint initiative will be focused at large corporate customers, and directly provides competition to IBM Corp. and its Global Services division. "There are a number of companies in this market, but yes, IBM is clearly a competitor," Rowe said.
According to Rowe, Sun and EDS have already identified 28 clients, though no one has specifically signed up for the joint services as of yet, Rowe said. "We will announce service formally this quarter, though some of the services are already ready and available," Rowe said.
Sun's contributions will include Sun Enterprise servers, Sun StorEdge products, the Sun Open Net Environment (Sun ONE) architecture, Java technology (as well as Java technical consulting) and iPlanet E-Commerce Solutions software, Sun and EDS said.
Sun and EDS are looking to offer corporate customers one-stop shopping when it comes to their Internet and networking needs, Rowe said. Specifically, the companies will work jointly on development, promotion, marketing, revenue targets, planned cross-training, account planning, offering development and marketing strategies, Sun and EDS said.
"The deal with Sun opens up a whole new marketplace for us, especially with small and medium sized businesses. As for what we bring to Sun, our sweet spot historically has always been selling to large Fortune 500 companies," Rowe said.