TCS, Nuuday sign major cloud transformation deal in Nordics

The length and size of the deal in terms of years and total contract value (TCV) were not officially disclosed, but estimates peg the contract at least $100 million or above.

Mukesh Ranjan, vice-president of Dallas-based IT research firm Everest Group, told Mint that the TCS-Nuuday deal will likely be of at least $100 million or larger in TCV, and could span over five to seven years. Nuuday also flagged the contract as “the largest IT transformation program” in the Nordic region.

TCS, according to the company’s official release, will host and manage Nuuday’s end-user services, and handle the Danish service provider’s IT infrastructure on the company’s managed hybrid cloud platform. 

The latter is a strategically key source of revenue for most top IT service providers globally. Demand for managed cloud services has been a sustained source of revenue in a year when demand for digital transformation-based discretionary tech deals has been weak.

“The Nordics are technologically advanced markets and this deal will help TCS showcase better capabilities in this region and further expand in Europe,” Ranjan added.

Deals worth $100 million and above form a key part of large and significant deals won by IT services firms. Typically, the ability to win large and mega deals (of $1 billion in TCV and above) signifies the general health of a service provider as well as the overall IT services industry.

This is TCS’ second deal in the Nordic region in less than two months. On 8 February, the IT major had signed a ‘multi-year’ deal with Enento Group, Finnish business and consumer information services provider, to transform its IT applications, cloud, digital workplace, and IT security.

“The deal opens up opportunities for TCS to bid for and expand its public sector/government business in this region by combining Nuuday’s local experience with its own global government domain capabilities,” added Ranjan.

TCS has more than 20,000 employees working in the Nordics region.

Nuuday’s move to TCS’ hybrid cloud infrastructure, as per the release, “will reduce time to market for new products and services”.

“We need a modernized and autonomous infrastructure estate that can support the increasing demand for the latest digital products and services,” said Monika Gullin, chief technology officer of Nuuday in a statement. 

Gullin added that the firm chose TCS “based on the company’s proven industry experience, and successful completion of complex cloud transformation projects in the digital communications sector”.

The TCS deal may help Nuuday optimize its cloud transformation. In June 2022, Nuuday signed a deal with Netcracker Technology Corp, a fully-owned subsidiary of Japanese multinational company, Nippon Electric Company Ltd, to eliminate legacy solutions by adapting to Netcracker’s cloud-native portfolio and professional services.

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Published: 15 Mar 2024, 05:54 PM IST