New interest in software products

Business Standard
Sasken, Ittiam, Pramati, Subex, Tejas Networks and the like are a select breed of Indian companies infusing a whiff of newness in a space dominated by software and BPO services. The Indian software industry is now waking up to the potential of software product business. This is manifest in the number of such businesses being set up. The heightened activity being witnessed now, coupled with the unique advantages for Indian software product companies, will ensure the success of a large number in the coming years, feel industry watchers. Over the years Indian companies have made a foray into software product development but have been able to capture only a meagre 0.2 per cent of the $180 billion global market for products. Now, as the Indian IT industry matures and there emerges the need to look at innovations to sustain high margin growth, the need to look at product development space more aggressively is being realised. more...

Seven Fearless Predictions For Outsourcing In 2006

Informationweek.com
There will be a major data-security breach at an offshore firm. The resulting controversy will have no impact whatsoever on the outsourcing industry as businesses realize the same thing happens in the U.S. almost every week. And here's six more of my can't-miss prognostications for the year ahead in outsourcing. An Indian IT-services firm will buy a significant U.S. software vendor. Many Indian tech companies are cash rich from recent IPOs and are looking for ways to diversify beyond outsourcing. Look for at least one deal where a major Indian player acquires an ISV with dominant market share in a vertical such as manufacturing or financial services. Lou Dobbs will continue his hypocritical, ill-informed tirade against outsourcing, even though he willingly accepts a paycheck from a company, Time Warner, that his own Web site says is "Exporting America." Questions for Lou: Do you think TW could afford your multimillion dollar salary if it wasn't sending back-office work to India? Have you offered to take a pay cut if it means keeping more Time Warner jobs in the U.S? more...

India faces offshore IT skills crisis by 2010

Silicon.com
A huge IT skills shortage and poor physical infrastructure could threaten India's position as the leading offshore outsourcing location by 2010, according to a new report. The report by consultant McKinsey and Indian IT body Nasscom warns that labour market pressures could leave India facing a shortfall of 500,000 IT staff equipped with the skills to work in the offshore outsourcing industry. Jayant Sinha, partner at McKinsey, said that India faces a challenge in maintaining its dominant offshore IT position. He said in the report: "The skills and quality of the workforce need to be improved, since only 25 per cent of technical graduates and 10 to 15 per cent of general college graduates are suitable for employment in the offshore IT and BPO industries respectively." Sinha said the country's urban infrastructure also needs "immediate attention" with better road and air links between India's high-tech hotspots. more...

Charlotte banks seek savings offshore

Miami.com
How much of a bank's work force can be sent overseas?
These days, more and more. You might not notice the shift because financial firms aren't getting rid of face-to-face workers such as tellers. But increasingly, they're tapping support and technology staff in low-wage countries, from computer programmers to financial analysts. In fact, the financial services sector is one of the more aggressive in offshore outsourcing. A new report predicts the industry will move more than 20 percent of its costs offshore by 2010, up from less than 10 percent in 2006. That could mean the shift of 2 million jobs to low-cost countries such as India from the U.S., Europe and Asia by 2010, according to consulting firm Deloitte Touche Tohmatsu. Charlotte's banks exemplify the ramp-up. Starting with technology work in 2002, Bank of America Corp. now has 1,500 employees in India, handling tasks from computer work to market research. The bank said last week it plans to grow there. more...

BANGALORE INFRASTRUCTURE WOES WORSEN

SearchCIO.com
Arrivals at Bangalore's tiny airport are greeted with newspaper headlines screaming "Bangalore crumbling!" Like many sensational news stories, the one centered on Bangalore's overtaxed infrastructure has legs. These sorts of headlines have been greeting business travelers and tourists for years. In this case, though, the doomsday headlines have it right: "Bangalore is a national calamity in terms of infrastructure," said Azim Premi, CEO of Wipro Ltd. And he ought to know. Wipro is synonymous with Indian offshore outsourcing, and is a $1.7 billion giant with more than 100 acres of property in this city alone. "Some years back it was just bad roads, but now it's irregular power, blocked drains and mismanaged transport," said T. Kurien, CEO of Wipro's BPO unit. "The distance that took us just 10 minutes to go over a few years back, now takes at least an hour. It is putting pressure on costs," he said. more...