ING Taps IBM For Services

ING U.S. Financial Services is farming out the operation of its IT infrastructure to IBM under a $600 million, seven-year outsourcing deal disclosed last week. IBM will assume operation of ING's mainframe and midrange servers and run its IT help desk, voice, and data networks. About 300 ING employees will transfer to IBM as part of the deal.

ING is buying the services from IBM on an on-demand basis, meaning it will pay the vendor a variable rate depending on the level of computing power it consumes. As a result, ING says it expects to reduce IT costs significantly. The deal also includes a provision whereby IBM will help introduce advanced technologies with the aim of launching new customer services such as wireless account access.

The company will save "tens of millions" as a result of the deal, says ING U.S. Financial Services CIO Paul Donovan. The savings will make it easier to roll out advanced services. He adds: "It was an easy decision given what I would have had to do internally versus utilizing expertise that's already out there."