Worldcom screws down EDS bill

But to start paying again

EDS has cut its annual outsourcing charges to Worldcom by a whopping $83m a year. In return the bankrupt telco will resume payments to EDS, worth an estimated $600m a year over three years.

Under the previous contract, Worldcom was obliged to buy in a minimum amount of services from EDS. It still had to pay up if it did not use those services. According to Reuters, the cumulative minimum payment owing to EDS was "$5 billion, of which WorldCom has paid about $1.8 billion".

Worldcom had to get approval from the bankruptcy court for the deal, which will see it hand over an initial payment of $98.6m. EDS meanwhile sees a major weight lifted off its shoulders, even if all the fat has been cut from the contract. ®

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