The Memorandum of Understanding signed in April this year has now resulted in a contract.

Under the terms of the agreement, HP will provide a range of services including: data center management, help desk support, and desktop service environment. The agreement covers Ericsson's IT operations worldwide in more than 100 countries.

"Outsourcing of IT operations is part of Ericsson's ongoing changes within the IS/IT area, and its overall restructuring program aiming at radically reducing the operating expenses and cost of sales," said Per-Arne Sandström, deputy chief executive officer at Ericsson.

"Technology should be evaluated in terms of the business value it delivers. The announcement with Ericsson reinforces the strength of our step-by-step collaborative approach that enables us to deliver a more flexible and adaptive IT environment while lowering the total cost of ownership for our customers, " said Carly Fiorina, HP chairman and chief executive officer.

The agreement includes transfer of assets and about 1,000 employees globally at Ericsson Global IT Services to HP. The transition will begin in July, pending approval by competition authorities.

IS operations, i.e. development, implementation and management of applications, is not included in the agreement with HP.