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American Express Outsources To IBM

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NU Online News Service, Feb. 26, 12:05 p.m. – American Express Company, New York, has signed a seven-year, $4 billion technology outsourcing agreement with International Business Machines Corp., Armonk, N.Y.

The agreement calls for IBM to provide data center and computer services from American Express facilities in Phoenix and Minneapolis, and to deliver technical support services on-site at American Express offices around the world.

American Express says it will keep control of “core technology competencies,” including technology strategy.

American Express sells products and services in more than 200 countries, and its systems handle about 1 billion transactions a day.

About 2,000 U.S. American Express employees will transfer to IBM to help IBM handle the job, American Express says.

Transfers of technology operations in other countries will begin in May, and some may be affected by local agreements and regulations, American Express says.

American Express predicts the agreement will increase its flexibility and help it save hundreds of millions of dollars.