Last week IBM boosted their dividend and announced a share buyback plan, while this week we're hearing more about Indiana working their way out of a 10 year long, $1.34 billion IT contract. But is it really IBM's fault, or is it perhaps just a case of someone setting unrealistic expectations?

"Perhaps Indiana Governor Mitch Daniels will share this unfortunate outcome with the governors of the other 49 states because, as each state in this country is fighting for economic stability, they need to understand better than ever before that the technology projects and outcomes that can help reach that stability always carry with them significant risk."

IBM Took 'Goldmine Of Taxpayer Money,' Claims Bureaucrat

I used to work for a company that was successfully sued for $250 million by a state over a $10 million contract.  We got a settlement for $100 million IIRC.  Contracting with the government isn't like contracting with your average company.  You can screw a typical company and usually walk away.  If you screw the government, they have lots of resources and willingness to sue the pants off of you.

Hopefully for all involved, this is just some saber rattling, and things will get worked out for the better. It's hard to believe that given $1.34B worth of work, that the baby gets thrown out with the bathwater. Of course, given all of the small, sub-million dollar budget projects I've been on that have gone sideways, it's with a bit of Schadenfreude that I read this article.

Good news. I wish california  also follows on the same foot steps.

i worked on a project sub contracting with IBM for atate of california.

Back in 2000 all of  state offices in sacramento were full of ibm hardware, ibm software and thousands of ibm consultants.. and the project was a 12 yr contract. so i guess its still going on.

if all state goverments just look at how they spend money on bad software, they can save ton of money.  

IBM is the most expensive service and software out there, but quality of both remains very low! So ridiculously low in fact, that it's hard not to know that, with all the allegations coming from that fact.

IBM and similar consulting organisations love governments, because in the end most departments are run/ headed by fools who have little if any business knowledge and even less technical aptitude. When things go south, they end up spending more government money to cover up and hopefully fix the problem so they dont look bad. Who cares if its waste or a bad deal, its not their money.

The facts won't matter to the IBM haters in the audience, who will take this opportunity to bash IBM based on their memories of WebSphere 3.5 or some similar idiocy.