The Outsource Blog

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Posts Tagged ‘Firms’

More firms opt for smartphones

September 19th, 2011

New figures show that users of IT outsourcing in London are buying more smartphones than feature phones for the first time.

Data published by IDC has found that these are now the preferred type of device in Western Europe for the first time.

The European Mobile Phone Tracker found that feature phone shipments fell by 29 per cent in the second quarter of 2011, while smartphone shipments have risen 48 per cent in the last 12 months.

Smartphones now comprise 52 per cent of total mobile phone shipments, with every European country seeing rising adoption of this technology.

Francisco Jeronimo, European mobile devices research manager at IDC, has highlighted the fact that Android-driven handsets have been part of these rising volumes.

He said: “Smartphones now dominate the Western European phone market and those vendors with stronger portfolios in the segment are consolidating their positions, compared with those manufacturers with less attractive smart devices.”

Last month, author Ian Price warned businesses that they need to take the changes that new technologies provide into account when planning for the future.

Breaking news from ihotdesk, IT Consultancy in London.

Source:http://www.ihotdesk.com/article/800726377/IT-outsourcing:-More-firms-opt-for-smartphones

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No truth in Indian firms grabbing H-1Bs: US chamber of commerce

August 17th, 2010

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The US chamber of commerce has lambasted the anti-H-1B visa sentiment by US senators against Indian IT firms.

The chamber has retorted saying that less than half of the H-1B visas are used for tech or software programmer jobs, and thus the talk that H-1B visa employees take away US jobs is a ‘hyperbole’. The US chamber of commerce, has more than three million members.

The chamber says that H-1B visas fund US education in a big way, rather than taking away US jobs. “H-1B visas are in fact a large source of scholarship money for US students, with H-1B training and scholarship fees levied on each petition (and renewal) having funded more than 53,000 math and science college scholarships for US students through the national science foundation,” says Randel K Johnson senior vice president labour, immigration & employee benefits at US chamber of commerce.

In FY 2009, Indian tech companies used 4,809 new H-1B visas, which equals to just 0.003% of the US civilian labour force. Moreover, H-1B use by Indian companies has declined by 70% between 2006 and 2009.

While much of the research attempting to find the impact of H-1B visa holders on natives has focused on computer programmers, less than half (52,984 or 48%) of the H-1B petitions issued in FY 2008 were for “occupations in systems analysis and programming,” the chamber cites, quoting statistics by the US department of homeland security. Indian IT companies utilised even lesser (6%) of the total cap of 65,000.

The report is titled : Regaining America’s Competitive Advantage: Making our Immigration System Work. It is jointly authored by American Council on International Personnel (ACIP) and US chamber of commerce, which is also the world’s largest lobby group, spending more than $144 million a year on just lobbying costs.

H-1B visa holders are spread across many other fields, including accounting, engineering, medicine and education.

Much of the competition for US programming work has become global, as a good deal of the work can be done in other countries.

Corporate America also lambasted the anti-outsourcing sentiment. “If such service providers enable US businesses to concentrate on core functions and run more effectively, then US companies can hire more people in the long run, the US chamber of commerce added.

Critics of H-1B visas have focused on violations in granting the visas. According to the Chamber, it’s the smaller companies which are liable to more violations than large firms, which have come under fire for employing large number of people under H-1B program.

According to the US citizen and immigration services, companies with less than $10 million in annual revenue had a 41% violation rate, compared to a 7% rate for companies with greater than $10 million in revenue. Only 7% of companies with more than $10 million in annual revenues (eight cases) audited were found to have suspected fraud or technical violations, says the US chamber of commerce, thus putting forth a case for more H-1B visas.

Source:http://economictimes.indiatimes.com/Visa-Power/articleshow/6322118.cms

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Tags: Firms Indian IT Outsourcing

US action will singe IT firms

August 15th, 2010

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Even as United States president Barack Obama hails India on her 63rd independence anniversary, the new Border Security Act, which raises visa fees substantially, is expected to cost information technology (IT) outsourcing firms in India a whopping $200 million (Rs930 crore) a year.
The US has increased skilled work visa charges by nearly $2,000 (Rs93,000) per person per year. There are 70,000-1,00,000 Indians in the US, nearly all of them IT professionals, working on three-seven year visas, who will be impacted by the change.
The move is targeted at bridging the cost difference between employing an Indian technology worker and a local worker. Indian and international IT firms prefer hiring Indian workers over locals as they are paid $60,000-$80,000 a year, making them around 20% cheaper than Americans.
Killing two birds with one stone, the Emergency Border Security Supplemental Appropriations Act — the bill passed by the Senate on Thursday and signed by Obama on Friday — seeks to channel the extra visa revenues into sealing of the US border with Mexico.
With elections to the Senate and House of Representatives due in three months, feelings have been running high about the influx of illegal immigrants from Mexico.
Indian industry has criticised linking the two distinct issues. “While the need to secure greater funding for strengthened security along the US-Mexico border is understandable, illegal immigration issues are not linked to the temporary movement of skilled professionals,” protested Chandrajit Banerjee, director-general of the Confederation of Indian Industry.
“We have been made a scapegoat,” said Som Mittal, president of Nasscom. “Instead of catching illegal immigrants who break the law, you are trying to tax people who have followed the law.”
According to the US government, around 15 million Americans (10% of the workforce) are looking for work. “Unemployment is largely in manufacturing, construction, and retail. We fail to see how they are related to skilled worker visas,” Mittal added.
As per the act, firms with more than 50% local employees will be exempt from the new charges. Thus, outsourcing giants such as IBM and Accenture, which compete with Indian firms for most contracts, can continue to send Indian workers to the US under the old charges as they also have many local workers there.
However, for Indian biggies like Infosys and TCS, who between them have around 25,000 Indian workers in the US, the 50% mark is a long way off. It is estimated that local residents make up only around 15% of their US deployed staff.
For now, no one expects the extra expense to dent the India advantage of outsourcing giants like Infosys. But the IT industry is definitely worried that Obama’s election rhetoric “Buffalo-not-Bangalore” has started becoming laws. “Our objection is not so much on the costs, but on the principle,” says Mittal of Nasscom.

Source:-http://www.dnaindia.com/india/report_us-action-will-singe-it-firms_1423527

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Opportunity comes knocking on outsourcing firms’ doors

March 23rd, 2010

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The outsourcing industry received its biggest bonanza yet with the US healthcare bill being passed by the House of Representatives. Theopportunity that it throws up for outsourcers is huge and far bigger than the Y2K, which included only changing code, said experts. When the bill becomes law, it will bring around 32 million more Americans under insurance cover, pushing healthcare providers and insurance firms to become more efficient and opening up demand for less-expensive services, better technology and business intelligence.

“The opportunity is not at a company-level but at an industry level,” said Milan Sheth, partner, Ernst & Young, indicating the scale of opportunities that is expected to unfold over the next 10 years. Nearly all top IT firms and BPOs have been anticipating the move and preparing for it by pursuing contracts and acquisitions giving them a footprint the US healthcare provider and insurance segment, estimated at around $ 30 billion.

A significant amount of business will come from enrollments, claims processing and providing customer services with technology and tools helping insurance providers get more customer insights and price their products appropriately. “Universal access to insurance increases the risk to insurance providers, forcing them to become more efficient by lowering costs,” said Suresh Ramani, COO, Intelenet Global Services, a BPO provider. From no revenues from healthcare providers and payers, Intelenet now gets 10% of its revenues from this segment.

Mumbai-headquartered IT services provider, Patni Computer Systems, announced a strategic deal with a US-based healthcare insurance provider that involved taking over part of its operations in El Paso, US, only last week. “Patni sees significant healthcare outsourcing opportunity both in IT and BPO areas. The additional enrollees will need to be administered and this means a lot more work in areas of claims processing, enrollments, underwriting support, customer support et al for insurance carriers, which is outsourced to companies such as Patni,” said Sanjiv Kapur, senior VP and head – BPO, Patni.

“There will be increased volumes both on the provider and payer side. It is a big positive for us because the big part of what we do is eligibility services, where we assess eligibility and enrol people into medicare programmes… I expect a bulk of business to come in 2014,” said Ananda Mukherji, CEO, Firstsource Solutions, which will gain from its MedAssist acquisition done in 2007. This kind of opportunity will require players to also have an onshore presence, in some cases, because of regulatory requirements and in others, because of the high-end processing involved, said industry executives. A few like Firstsource and Cbay already have an onshore presence and while others are building it.

Source:http://economictimes.indiatimes.com/ITeS/Opportunity-comes-knocking-on-outsourcing-firms-doors/articleshow/5713526.cms

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Data protection law to boost outsourcing firms

March 2nd, 2010

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The drive by business process outsourcing firms to capture clients in the financial sector could get a boost from a policy change expected to come into force soon.

Lack of a data protection law to assure players in the financial sector of the safety of their corporate information is one of the major factors that have made banks to prefer handling their customer services internally.

“A law on data protection has been held back because it was tied to the Freedom of Information Act. We expect both laws to be approved by the Cabinet in their next few meetings,” Bitange Ndemo, permanent secretary in the Ministry of Information, said.

Analysts say that banks, for instance, fear litigation that is likely to come with disclosure of customer information.

They argue that even with the passage of the data protection law, banks may only outsource less sensitive processes like loan applications.

“There is a bit of concern with regard to quality of services offered by local BPO firms,” said Eric Musau, an analyst at Renaissance Capital.

Mr Zain Khan, an international ICT consultant, said that banks in other parts of the world like the US are also preferring to maintain their hold on customer-related processes out of fear of data leakage.

“Banks fear leaks of information to their competitors and would therefore rather do the job themselves,” he said.

Musau added that another factor hindering the BPO companies from netting large clients is the costs involved.

“Outsourcing depends on scale. Organisations with small volumes of processes are in a better position to outsource compared to those with large volumes that may find outsourcing more expensive,” Mr Musau said, citing the example of Safaricom that has chosen to invest in its own customer contact centres.

Eric Nesbitt, the operations director at KenCall, a call centre, confirmed that outsourcing may sometimes be more expensive compared to internal operations.

He said that in such cases, other value added benefits of outsourcing are what would woo clients.

“Companies that outsource cut on staff numbers while remaining with their areas of core competencies which helps boost their productivity and profitability,” he said.

Mr Nesbitt observed that the whole issue of major companies choosing not to outsource is probably because of the new outsourcing experience in the country.

With time, he said the sector’s credibility will rise and this will enable it to tap more business from companies in the financial sector.

Source:http://www.businessdailyafrica.com/-/539552/871332/-/6cfjvv/-/

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Firms to avoid owning hardware, Gartner predicts

January 19th, 2010

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An increasing number of companies are likely to reduce the number of IT assets they own, it has been suggested, which may boost the need for IT outsourcing.

IT industry analyst Gartner predicted that businesses are likely to avoid owning hardware and instead rely on third parties to meet their computing needs, with 20 per cent expected to owe no assets by 2012.

“Several interrelated trends are driving the movement toward decreased IT hardware assets, such as virtualisation, cloud-enabled services and employees running personal desktops and notebook systems on corporate networks,” the organisation explained.

In addition, Gartner said that mobile phones will become the most common internet access device, overtaking PCs by 2013, as consumers and firms increase their investment in smartphones and browser-equipped enhanced mobiles.

The group explained that this will lead to a change in how companies design their websites, as they will need to be used on smaller screens and require fewer clicks to navigate.

Recently, Patrick O’Brien, senior analyst at technology market consultancy Ovum, claimed that IT outsourcing providers are becoming more innovative in a bid to attract customers

Source:http://www.ihotdesk.com/article/19563210/Firms-to-avoid-owning-hardware,-Gartner-predicts