Cap Gemini moves to offer 'time and materials' IT service

Cap Gemini Ernst & Young, the French IT consulting and services firm, is set to launch a spin-off company offering manpower and expertise on a 'time and materials' basis, according to reports.

The creation of the new operation - tentatively called Gemini and likely to employ 5,000 people - will mark a major change for Cap Gemini which is best known for offering high-end consultancy.

Although, Cap Gemini does offer some 'time and material' services already - where company engineers with knowledge of specific hardware and software will go an work on a short term basis - this has always been overshadowed by its longer term project work.

This morning's WSJ quotes Jean-Claude Langolf, a Cap Gemini engineer, who says the new operation could be up and running as early as 1 January with employees in France, Benelux and the US preparing to be transferred.

Cap Gemini has been forced to take an axe to its costs over the last few months as it battles against reduced revenues.

The company will announce its plans at meeting on 13 December.