BSkyB set to sue over failed CRM project

British Sky Broadcasting (Sky) is considering legal action against EDS over a £60m customer relationship management (CRM) contract.

The EDS contract was a substantial part of Sky's £170m investment in CRM since 2000, but the deal was terminated in December 2002, with the broadcaster choosing to do the work itself. In its annual report, published last week, Sky says it will seek a 'material amount' from EDS to compensate for problems with its CRM systems.

Sky says in its report that: 'The group anticipates issuing and serving a claim in the near future for a material amount against an information technology solutions provider, which has provided services to the group as part of the group's investment in customer relationship management'.

EDS confirmed that BSkyB has 'asserted a contractual claim over the deal'. It said that the broadcaster took back responsibility for CRM delivery in early 2002 and that it terminated its relationship with BSkyB at the end of the same year.

BSkyB’s disclosure of a forthcoming lawsuit came as new chief executive James Murdoch outlined plans to invest heavily over the next three years in CRM, marketing and infrastructure.