Hewlett-Packard, the US computer company, yesterday announced an alliance with Accenture, the technology consultant group, in an attempt to challenge IBM in information technology services. The link-up is an important component of Hewlett-Packard's strategy to expand its services business following its failed bid for the technology consulting unit of Pricewaterhouse-Coopers late last year. The companies said they would extend their partnership in IT outsourcing, and work together to help large companies move their most important applications from mainframes to newer computer systems.

Ms Carly Fiorina, chief executive of Hewlett-Packard, has identified IT services as a strategic and key element in her broad restructuring of the company.

IBM Global Services is the chief competitor to Hewlett-Packard and Accenture. This group is responsible for about 40 per cent of IBM's revenues and has about 150,000 staff. Demand for IT services is strong among large corporations as they seek help in implementing complex e-business projects, and as they try to cut operating costs by outsourcing IT departments. Accenture, formerly known as Andersen Consulting, has 70,000 staff in 48 countries.