Sky wins another £70m payment from HP

HP has been ordered to make a further interim payment of £70 million to broadcaster BSkyB, over a failed EDS software implementation.

The new order, by the Technology and Construction Court, which must be paid within 14 days, takes HP’s total payments to £270 million, over a system originally pitched by EDS to cost £48 million.

The new £70 million costs include £33 million further damages, on top of the £200 million paid in the last two weeks, and £37 million of interest on the damages. The judge is now assessing further issues.

The total sum is equivalent to $405 million, which is more than three quarters of the earnings of HP’s global PC business in the three months to 31 January, and is worth nearly two and half times the earnings of its software business in the same period.

In January, EDS was found to have fraudulently misrepresented the time needed to complete the project, when pitching for the deal in 2000. It did so in order to win the work instead of rival PricewaterhouseCoopers, the judge found.

HP, the owner of EDS since 2008, today reiterated it would appeal the judgement, adding: “While we accept that the contract was problematic, HP strongly maintains EDS did nothing to deceive BSkyB."

While HP was found to have fraudulently misrepresented the time needed for the project, no fraud was found over promised resources, cost, technology or methodology.

Copyright © 2010 IDG Communications, Inc.

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