• Posted by: Technology Staff Editor
• On: 05/13/2008 10:23:48
• In: Information Technology

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British airline Virgin Atlantic has extended its technology outsourcing contract with India's Tata Consultancy Services.

Under the deal, TCS will continue to manage Virgin's network and computing infrastructure and application development needs through 2011. TCS will also provide 24-hour help desk services for the airline and manage its relationships with third party IT vendors.

"Today, airlines need to effectively exploit IT more than ever to be successful in a very competitive marketplace," said Virgin IT director Mike Cope, in a statement.

Financial terms of the deal were not disclosed.

Airlines typically outsource certain tech and customer services operations to lower cost countries like in India to save money. However, with the price of jet fuel skyrocketing along with other petroleum-based fuels, the savings only go so far.

A number of airlines, including Midwest, have in recent weeks announced service cuts in response. Others, such as American Airlines and Delta Air Lines, are raising fuel surcharges on tickets.

Travel and transportation is becoming an increasingly important vertical for TCS, accounting for 4% of the company's $5.7 billion in total revenues in its most recent fiscal year. The company last year launched a dedicated Travel & Hospitality Innovation Lab in India to develop software and services aimed at companies in those industries.

In tackling the aviation market, TCS is going head-to-head with Dallas-based Electronic Data Systems, the world's largest provider of outsourcing services to the airline industry. On Thursday, EDS and Microsoft announced an agreement under which EDS will use Microsoft technology to build computing networks that use service oriented architectures for its airline customers.