Posts Tagged ‘TCS’

Infosys struggles as industry laggard

May 1st, 2013

When Infosys became the first Indian company to list on the technology-heavy Nasdaq stock exchange in 1999, it was a moment of pride for the nation that had put behind socialist isolation to embrace globalisation.
So much so that then prime minister Atal Bihari Vajpayee said that leaders from developed nations were visiting Bangalore, where Infosys has a lush-green campus, like they used to visit the Taj Mahal. outsourcing13
Now technology’s Taj Mahal has lost some of its marble glow.

For most of the last eight quarters, India’s second-largest software service company has been lagging market expectations — and worse, some industry peers. This is unthinkable for a company known for outshining since its humble start in 1981 and a stymied IPO in the early 1990s when it was not taken seriously.

Its stock plunged by 21% on April 12 when it forecast revenue growth of 6 to 10% for 2013-14, well below industry association Nasscom’s industry estimate of 12 to 14% growth for IT/IT-enabled service exports.

Murmurs have started that some board members of the company in which foreign institutional investors (FIIs) hold more than 35% want a change in leadership amid senior-level changes inside.

“We have been hearing of management changes that do not hold well for the stock,” said Ankita Somani, IT industry analyst at Angel Broking.

“Ever since Shibulal has taken over, we have been seeing senior level changes every two months,” added Somani.

The softspoken S.D. Shibulal, the fourth among the seven co-founders to don the CEO’s mantle, is facing pressure of the kind no one has faced in the company’s history. With good reason. Industry leader Tata Consultancy Services (TCS), late riser HCL Technologies and outsourcing peer Cognizant Technology Solutions have been steadily outperforming Infosys.

“It is taking more time for them to grab additional business. Infosys has been reluctant to drop profit margins, but is now showing more flexibility. But the competition is gaining more business,” said Dipen Shah, IT industry analyst at Kotak Securities.

Industry watchers used to first chief executive officer (CEO) NR Narayana Murthy’s articulate, bold style and successor Nandan Nilekani’s focused confidence have picked holes in the understated styles of its last two heads, S “Kris” Gopalakrishnan and back-room boy Shibulal, who is due to complete two years in August.

Both Kris and Shibulal have been known for their down-to-earth styles and hands-on service management.

“It is difficult to have two back-to-back operational CEOs and expect the company to survive,” said an industry veteran who did not wish to be identified. “It seems they want to just ride out their terms.”

Those are harsh words for a company that was founded when personal computers did not exist. From mainframes to mini computers to local area and wide area networks to the Internet, Infosys has successfully ridden every major wave of the desktop era, weathering storm after storm.

Officially, the company is busy now crafting a new strategy that it calls Infosys 3.0. There is a reason why a new story is needed — though its plot is far from clear to those who are tracking it.

Things were easier when Infosys, alongside Tata Consultancy Services and Wipro, thrived on India’s abundant pool of software engineers at a fraction of what it cost to hire similar talent in the West.

Now salaries have steadily risen, and techies and manages have many other places to go to as global firms expand in India.

With only founders sitting on the CEO chair so far, senior-level exits have been frequent over the past five years as young and restless managers seek faster growth.

For middle-level employees, avenues have opened up in companies like Accenture and IBM, which have caught up in size to match TCS and Infosys in India. Accenture now has 80,000 people in India – and that is more than half of Infosys’ headcount of 156,700.

“Time and material” pricing, or renting out talent by the hour, has been the staple pricing model for Infosys that is being questioned by some, including its own former sales head Phaneesh Murthy, who left to head iGate. iGate is betting on a model that involves pricing services based on shared risks and outcome.

“No company can talk the same model forever,” Murthy said assertively.

Infosys is not sharing risks, but instead has a new growth recipe — a business unit called platforms, products and solutions (PPS). The PPS unit is investing in the creation of intellectual property (IP) -sometimes jointly with clients.

For example, it has created a mobile wallet platform for telecom service provider Bharti Airtel that stays with Infosys. The client pays per transaction conducted. Over a longer period, the low-price turns meets high volumes.

“We have to change strategy for high quality growth over the medium to long term” says V. Balakrishnan, board member and head of Infosys’ business process outsourcing (BPO) and banking product unit.

“But we are doing this while the environment is against us.”

The environment has most certainly been against Infosys since the Wall Street crisis of 2008, which followed soon after the exit of its sharp CEO Nandan Nilekani. The juiciest of banks financial industry clients like Goldman Sachs- who account for more than 30% of Infosys revenues, were the worst hit across the West.

As the Great Recession hit North America and Europe, the other big focus, high-skill consulting, also took a hit. Consulting, was Infosys’ original path to boost profit margins but this involves futuristic “discretionary spend” by clients – which gets hit most when companies tighten their belts.

The twist in the consulting tale came at a horrible time.

Source:http://www.hindustantimes.com/business-news/CorporateNews/Infosys-struggles-as-industry-laggard/Article1-1052849.aspx

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TCS, Infosys, Wipro abusing H-1B visa system: US Senator

April 29th, 2013

Amidst Congressional debate on the comprehensive immigration reform, a top US Senator has accused big Indian IT companies — TCS, Infosys and Wipro — of abusing the H-1B visa system.

“There are some specific abuses of H-1B,” Senator Richard Durbin, said during a Congressional hearing on immigration reform by the powerful Senate Judiciary Committee on Monday, during which the lawmakers discussed threadbare the H-1B visa issues. tidel_1437069f

In fact, Senator Durbin went on to brand the top Indian IT companies as outsourcing firms.

“These outsourcing firms like Infosys, Wipro, Tata and others — Americans would be shocked to know that the H-1B visas are not going to Microsoft; they’re going to these firms, largely in India, who are finding workers, engineers, who will work at low wages in the US for three years and pay a fee to Infosys or these companies,” Durbin alleged.

“I think that is an abuse of what we’re trying to achieve here. Most people would think, well, Microsoft needs these folks, and they’d be shocked to know that most of the H-1B visas are not going to companies like yours; they’re going to these outsourcing companies,” Durbin alleged.

He said this during the hearing in which two Indian Americans testified before the committee and supported the allegations of the Senator against Indian IT firms.

Brad Smith, general counsel and executive vice president, legal and corporate affairs, Microsoft, too supported the Senator on the issue.

“I personally think it’s important that we both recognise the need for these firms to evolve their business model — I’ve had these conversations myself with them in India — that encourages them to focus on hiring more people in the US,” he told lawmakers in response to a question.

The proposed comprehensive immigration bill if passed by the Congress and signed into law by the US President would bar companies from hiring people on H-1B visa if 50 per cent of their employees are not Americans.

The US India Business Council and Confederation of Indian Industry have opposed such a move and said that this is against the spirit of India-US strategic relationship.

The issue was also raised by the Union Finance Minister, P Chidambaram, when he met the Treasury Secretary, Jack Lew, in Washington last week on the sidelines of the annual Spring meeting of the International Monetary Fund and the World Bank.

Chidambaram told Lew that “temporary relocation of knowledge workers should not be confused with immigration.”

Testifying before the Senate Judiciary Committee, Smith told lawmakers that he had told the Indian companies three years ago to change their business model which was heavily dependent on H-1B visas.

“I told them that three years ago. They better recognise that there’s no large country in the world that allows people to employ over half of their people from outside the local population. So I do support that,” he said.

“I do think it’s important that one not eliminate their ability to do good work, because they also do good work.

I don’t want to lose sight of that,” he added.

Neeraj Gupta, CEO and cofounder of Systems in Motion, who once was on the H-1B system, said the number one users of H1B and L1B visas are the offshoring industry.

“Also, the number one reason why enterprises use off showing programmes is for cost reduction. Isn’t there a direct correlation? How could one miss the linkage that the visas are primarily being used for lower costs? It did not matter who the beneficiary of these visas is.

“It could be a large offshore company with headquarters in India or the US or a global major like IBM or Accenture,” he said.

Gupta said the US market is the largest revenue source for offshore vendors.

“H-1B visas allowed them to create easy mobility and keep utilisation rates high. The first question an Indian business would ask was why do we need to hire an American worker when we can get a cheaper resource in India, benched in India at a lower wage and mobilised on an as-needed basis,” he alleged.

“The offshore majors mostly hired H-1B employees because the current policy provided them a subsidy,” he said, adding that there’s a lot of resources available that one can hire and train here in the US.

“The majority of the work done by H1B employers is really not specialist work. Most of them have between three to eight years of experience and they go on to do work for large IT departments for US banks, insurance companies, telecom operators.

“This is not the kind for which we need more H1B visas such as what Google and Microsoft might need and is not traditionally considered specialised work,” he said.

Source:http://www.thehindubusinessline.com/news/international/tcs-infosys-wipro-abusing-h1b-visa-system-us-senator/article4646760.ece

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TCS, HCL are Scandinavia’s favorite outsourcers

April 25th, 2013

Over 100 of the top IT spending Nordic organisations intend to outsource more of their technology operations in the future.
Increased outsourcing is on the cards for 40 percent Scandinavian firms.

Whitelane Research published last week the findings of a survey of 350 organisations in Denmark, Finland, Iceland, Norway, and Sweden. They signed over 1,000 IT outsourcing deals last year, with a total combined value of 4.5 billion euros. business-screen-workers-hand-200x150

Increased outsourcing was on the cards for 40 percent of respondents, who said it was the best way to cut costs. Any outsourced IT jobs would most likely move offshore.

“Some providers (in particular, local Scandinavian vendors) will have to work on further developing their global service delivery capabilities in order to remain competitive with these cost reduction requirements,” Whitelane said in the report.

Tata Consultancy Services (TCS) and HCL shared the number one ranking for service provider satisfaction. The top five was rounded out by Indian companies Cognizant, Infosys, and Mahindra Satyam. There were almost 30 percentage points difference between the first and last ranked providers.

“The results reveal that service providers can increase satisfaction levels while focusing on being more proactive and creative in order to meet the request for further cost savings,” the report said.

About 280 companies renewed their existing contracts last year, and of these about 40 percent renegotiated the value of their contracts. In 93 percent of these cases, they successfully negotiated for cheaper services.

Source:http://www.zdnet.com/in/tcs-hcl-are-scandinavias-favorite-outsourcers-7000014454/

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Indian IT firms set for battle over deals worth $100 billion

April 1st, 2013

The battleground for information technology (IT) outsourcing contracts is set to heat up this year between domestic and foreign software firms, as companies like International Business Machines Corp. (IBM) and Accenture Plc. attempt to prevent losing more outsourcing projects to Indian vendors. outsourcing15

Top executives at Tata Consultancy Services Ltd, Infosys Ltd, Wipro Ltd, Cognizant Technology Solutions Corp. and HCL Technologies Ltd are gearing up for an intense battle, both against the foreign firms and each other, for outsourcing contracts collectively worth more than $100 billion that are up for renewal this year, according to estimates provided by outsourcing advisory Everest Group.

Two contract renewals likely to be hotly contested are of Australia’s largest phone company Telstra Corp. Ltd and the world’s biggest consumer healthcare products company Johnson & Johnson , according to several outsourcing experts and industry executives.

Telstra signed IT outsourcing agreements with Infosys, Hewlett-Packard-owned Electronic Data Systems Corp. (EDS) and IBM in 2009 for five years, and discussions for their renewals have already begun. The contracts, originally worth about $1 billion, are expected to be bid for at least $1.5-2 billion, the outsourcing experts said.

The renewals come at a time when seasoned customers of Indian IT services are more open to switching vendors, as increased competition for re-bids often tend to lower pricing and boost margins, said Peter Bendor-Samuel, founder and chief executive of Everest Group, in a telephone interview.

Telstra, which had about 10 million domestic mobile subscribers at the time the deal was signed, currently has 14.4 million mobile phone customers in Australia — more than three-fifth of the country’s population — and is trying to cut costs as it battles high smartphone and hardware costs.

Much is at stake for large Indian software companies like Infosys, which has grown at a sluggish pace the last two-three years compared with rivals like TCS and US-based Cognizant that have consistently outdone estimates for revenue growth and are seen as the new sector flag-bearers. Telstra has been a client of Nasdaq-listed Infosys since 2003.

For IBM, holding on to this contract will be crucial, after a separate outsourcing services deal it had with Telstra was scrapped and given to Infosys in 2009. IBM recently also lost outsourcing contracts from US health insurer Wellpoint Inc and financial services provider India Infoline Ltd.

Another company with plenty to lose is Hewlett-Packard Co., the world’s largest personal computer maker that also provides software services. HP recently lost deals to TCS and HCL Tech and experts say the company run by Meg Whitman will be more aggressive in protecting its own turf and going after other contracts.

An IBM spokesperson said her company does not comment on confidential client information, while Johnson & Johnson (J&J), HP, Accenture, Capgemini, TCS, Cognizant, Infosys, Wipro and HCL Tech declined to comment for this story.

“Telstra is a strategic account for Infosys, IBM, and EDS, and a hard one to give up,” said Ray Wang, founder of enterprise research firm Constellation Research Inc.

“The original vendor consolidation deal in 2009 left Telstra with a competitive situation among its suppliers. Many MNCs (multinational companies) like to keep two to three strategic suppliers on board to keep things competitive on price, and to see how innovative the suppliers can become. However, when we see an MNC go sole source, several years later, they will often go back to having multiple vendors because of the lack of competition and innovation,” Wang said. “The Indian IT players can expect a tremendous pressure on pricing but also a new focus on how well they can deliver on innovation in these deals.”

Companies like Telstra and J&J often tend to rebuild the structure of their contracts, breaking them into small pieces and handing them out to multiple vendors, experts say.

“With Telstra, they first signed the agreement with HP through EDS. Then they broke up the structure of the deal and brought in Infosys. Now they’re thinking about the structure of the deal once again. You can expect that contract to be heavily competed,” said Bendor-Samuel.

A Telstra spokeswoman hinted the company might review the structure of the contracts with its current vendors.

“Telstra constantly reviews its supply chain arrangements to make sure it has the right arrangements to support its business. We will review these contracts as part of our ongoing business improvement programme to achieve the best value and outcome while simplifying our business,” the spokeswoman said in an emailed response.

Other large telecom deals for which renewal talks have begun include Bharti Airtel Ltd’s 10-year contract with IBM, estimated to be worth $2.5 billion now, and Uninor’s outsourcing agreements with Wipro.

Johnson & Johnson’s outsourcing contract with top Indian service providers, including Wipro, is also being keenly tracked by the sector. Although the exact value of the J&J deal is unknown, it is estimated to be worth at least $1 billion, according to the outsourcing experts. Discussions for the renewal due next year have begun.

The Johnson & Johnson contract renewal comes at a time when the North American healthcare outsourcing market presents significant opportunities for the Indian IT sector, with US President Barack Obama’s push to overhaul the healthcare system to include 30 million more Americans.

Experts say though there are good chances of companies like Telstra and J&J switching vendors, most contract renewals tend to stay with original vendors. “For Johnson & Johnson or any other large organization, they should not switch the vendor purely based on pricing or unless the vendor has done something terribly wrong,” said Manish Bahl, vice-president and country manager at Forrester Research Inc. “They have already invested a lot in the relationship with their existing vendor and getting a new vendor will take its own ramp-up time in addition to technology or operations related challenges.”

Source:http://investing.businessweek.com/research/stocks/news/article.asp?docKey=600-201303150836KRTRIB__BUSNEWS_47705_35327-1&params=timestamp%7C%7C03/15/2013%208:36%20AM%20ET%7C%7Cheadline%7C%7CIndian%20IT%20firms%20set%20for%20battle%20over%20deals%20worth%20%24100%20billion%20%5BMint%2C%20New%20Delhi%5D%7C%7CdocSource%7C%7CMcClatchy-Tribune%7C%7Cprovider%7C%7CACQUIREMEDIA%7C%7Cbridgesymbol%7C%7CUS;HPQ&ticker=HPQ

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TCS, Capgemini jointly bag Norway Post’s $86 mn IT outsourcing contract

March 28th, 2013

India’s biggest IT services company Tata Consultancy Services (TCS) and global IT services and consulting company Capgemini have been awarded IT upgradation contracts worth $43 million each from Norway Post, the Norwegian postal service.

In a release issued on Monday, Norway Post said it has split the procurement of IT operations and application management services between two vendors – TCS and Capgemini. Outsourcing1

“The estimated value to each of the suppliers Capgemini and TCS during the contract period is around NOK 250 million,” the release posted on its website, says.

“The new contracts will make it possible to reduce costs considerably and gives us access to relevant expertise from two large and recognised global players. We’ve now paved the way for new and future-oriented IT solutions for Norway Post,” says Morten Stødle, CIO in Posten Norge AS (Norway Post).

While Capgemini employs about 4,500 employees in the Nordic region serving about 103 clients, TCS has around 1,600 employees in the region.

As a part of the contract, TCS will be responsible for delivery of a wide range of application development and support services across Norway Post’s core portfolio of 55 applications. Additionally, TCS has also been entrusted to coordinate and drive the overall transition and transformation programme for Norway Post across multiple vendors, it said in a statement.

On its part, Capgemini will be responsible for delivery of application management and development of core applications, the company said in a statement. It includes outsourcing of central applications, such as ERP and data warehousing, it added.

Norway Post which delivers over 36 million packages and 2.2 billion letters every year is implementing a structured multi-sourcing model to drive efficiency and support their Nordic Integrated business strategy.

Source:http://www.business-standard.com/article/companies/tcs-capgemini-jointly-bag-norway-post-s-86-mn-it-outsourcing-contract-113032500478_1.html

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HCL Tech, TCS waiting to pounce on HP deals

March 1st, 2013

In the wild, it is a common strategy for the predator to single out the weakest prey and chase it down for a kill. In the cut-throat market for outsourcing deals, too, it works much the same way, and a woundedHewlett-Packard is fair game for Indian software companies desperate to win new contracts. Outsourcing10

“Indian outsourcing companies are aggressively attacking HP, which is a very vulnerable target right now,” said Peter Bendor-Samuel, founder and CEO at Everest Group, a Texas-based outsourcing advisory and market research firm. HP, sitting on plum contracts with the likes of American Express and Bank of America, is vulnerable as these deals worth billions of dollars are coming up for renewal.

About $100 billion (Rs 5.4 lakh crore) worth of IT outsourcing deals will expire in 2013, the Everest Group estimates, with 15% of it being with HP. PC maker HP entered IT services with its 2008 buy of EDS for $14 billion, but successive leadership changes in 2010-11, took a toll on investor confidence.

Dissatisfied clients easy prey
HP, whose shares have fallen 60% since early 2010, recently wrote down about $8 billion in the value of its services business and is cutting about 29,000 jobs, raising a red flag for clients. Bangalore-basedMphasiS, earlier an EDS company, is now part of HP.

While every outsourcer in the top tier is competing hard for HP’s clients, the most aggressive and successful ones are HCL Technologies and Tata Consultancy Services, observers said. So while the success rate for Indian companies in the renewal market is around 30%, TCS and HCL Technologies are winning 60% of the renewals involving HP clients.

While the companies declined to comment for this story, those familiar with their functioning said the sales teams are systematically chasing and winning clients from HP. “Large clients working with HP for last the 5-7 years are seeing relationship fatigue and are ready to work with new vendors,” said a senior industry executive, requesting anonymity.
“What we are promising instead is more value with lower price, transparency in delivery and flexibility.” The fate of HP, which Chief Executive Meg Whitman is looking to rebuild, is neither new nor unique. In 2009, after India’s then fourth-largest software exporter Satyam Computerwas hobbled by an accounting fraud, rivals quickly tried to win over the Hyderabad-based company’s most lucrative customers.

Among the deals won by the HPEDS combine, a large proportion relates to IT infrastructure, bread-and-butter areas for HCL Technologies and TCS. A concern for HP is that increasingly, clients are seeking flexible engagement models with elements of computing offered as a service, lower costs, and higher value.

These are increasingly hard to offer for traditional players that haven’t changed with the new market realities . This is creating frustration among clients, making them look for alternative service providers , analysts said. Using client dissatisfaction to get a foot in the door, Indian players are aggressively pitching newer technology-based solutions to these clients at lower price points.

“Everybody loses clients; that is part of the game. But the key is to be able to win new clients to compensate for the ones that you lose, and that is the more worrying sign for HP. We have hardly heard of any large new deals involving HP,” said the India head of a large multinational outsourcer.

Some analysts also see signs of HP making a concerted effort to protect its turf. “Quite frankly, it will be a challenging period, but I think HP is taking some right steps to make sure that its existing clients feel secure and comfortable,” said Frederic Giron, vice-president and principal analyst at Forrester Research.

“Time will tell.” What may work in HP’s favour is the fact that transitioning from one service provider to another, especially after several years of engagement, is very difficult. Rachael Stormonth, senior vice-president at US-based outsourcing advisory Nelson Hall, said HP’s enterprise services unit has for years suffered from under-investment in corporate functions and in portfolio development.

“The lack of investment in the portfolio has been evident. But HP enterprise services is arguably better positioned in 2013 than it has been in the last few years to contest such deals,” she argued.

Source:http://timesofindia.indiatimes.com/tech/enterprise-it/strategy/HCL-Tech-TCS-waiting-to-pounce-on-HP-deals/articleshow/18732286.cms

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Indian technology companies sharpen focus on patents

February 11th, 2013

India’s software exporters are trying to transform themselves from extravagantly staffed body shops doing grunt work by stepping up their intellectual property (IP) efforts as well as taking advantage of the opportunities that trends and technologies such as social media, mobiles and cloud computing offer. tcs--621x414

By trying to generate more revenue from so-called non-linear, or non-headcount-related businesses, these companies are trying to shield themselves from the risks that these technologies present to traditional offshoring and delivery models.

Among the effects of this trend is a concerted effort to file for patents, with IT companies trying to earn more with fewer employees as cloud computing alters the future of traditional information technology (IT) outsourcing with a pay-per-use or subscription model.

Other initiatives include automation, templates for industry segments that can be re-used with minimal customization, re-use of assets and codes, platform solutions and tools such as Six Sigma, besides value-added services such as analytics and IP.

India’s largest software exporter Tata Consultancy Services Ltd (TCS) increased its intellectual property rights (IPRs) activity by filing 460 patents in several countries in fiscal 2012, according to its annual report. The company had filed a total 855 patent applications as of 31 March last year, of which 72 were granted.

Infosys Ltd’s fiscal 2012 annual report said it filed 474 unique patent applications, while Wipro Ltd registered 101 patents, 18 copyrights and 11 designs as on 31 March 2012.

Indian IT services firms “have maxed out their current business models”, said Ray Wang, principal analyst and chief executive of Constellation Research Inc.

By applying differentiated IP creation, enabling Big Data (analysing the mountains of information that companies generate) business models, delivering innovation value chains and leading partner ecosystems, Indian IT services firms can create new, high-volume, high-value opportunities to fend off margin threats and become truly global players, Wang said in his 21 January report.

TCS, for instance, which has more than 250,000 employees, has invested in various non-linear opportunities such as software products, platform-based BPO (business process outsourcing) and software as a service, or SaaS, while focusing on unit-priced contracts.

A platform-based BPO allows for sharing of a technology solution with other firms. It helps cut costs since companies pay only for every invoice processed.

A case in point is TCS’ deal with the UK’s Pearl Group, for which it developed a life and pensions platform that it re-engineered for the UK market. The company also sharpened its focus on non-linear revenue initiatives with a cloud-based initiative for small and medium enterprises called iON, and a platform-based BPO.

The company has stepped up “end-to-end services”, TCS chief executive officer and managing director N. Chandrasekaran said in an interview on 14 January. “We are also investing a lot in the mobility business,” he said, without giving any numbers.

Infosys’ product efforts are centred on Finacle, its core banking solution. The company, according to Wang, has built its InfosysEdge platforms for a wide range of markets.

The concept starts with mapping a client’s business problem and pairing that with measurable outcomes.

It then incubates, co-creates and partners to deliver differentiated IP built with its services and industry domain expertise. Solutions are delivered using a cloud platform.

Recent wins, according to Wang, include OSG Corp. of Japan’s selection of Infosys CommerceEdge for its eCommerce portal; Infosys TalentEdge being selected for billing and payroll at Hudson; a partnership agreement with WPP for Infosys BrandEdge; and Bharti Airtel Ltd using Infosys WalletEdge for Airtel Money.

“Outsourcing on platforms is a massive paradigm shift for the industry and a huge, huge opportunity. IT spend is roughly 2-3% of a firm’s revenue. The trend that we are addressing today is some 20%—you can take any business process and start. On paper, we have 20-30 platforms, five of which are revenue earning,” said Kris Gopalakrishnan, co-chairman of Infosys.

Wipro is differentiating IP creation through its service productization network. Sample products include DMS Telecom, WiproDigital, SaaSefy, NetOxygen, Medicare Advantage and Wipro’s Mobile Devices Certification Lab. Similarly, in the BPO space, Wipro offers transaction-based pricing (i.e., for processing, payment per invoice, claim, etc.).

Wipro, according to Wang’s report, has also enabled customers to create smart energy meters, 3D cinemascope smart TVs, portable dishwashers, point-of-sale and workforce management terminals, high-performance computers, industrial-grade wireless routers and base station controllers.

Tech Mahindra Ltd and Mahindra Satyam Ltd (to merge on 21 March), jointly unveiled with a client a unified business transformation platform that brings the power of convergence of multiple technologies such as networks, mobility, analytics, cloud and security, said Wang.

L&T InfoTech applies Big Data to social analytics that makes use of natural language processing tools and sentiment analysis to offer a categorization framework to classify social media reactions.
“IT services firms must secure software and IP assets soon—or face a bidding war with the mega-software vendors for engineering, product, sales and marketing talent. Mergers and acquisitions (M&As) must be accelerated in order to catch up,” said Wang.

A January report by India Ratings and Research, an India Fitch Ratings Ltd company, expects M&A activity to continue in the IT sector in 2013. It said the preferred destinations were European countries, West Asia and Asia-Pacific regions such as India, Singapore and Australia, and the acquisition targets are likely to be companies with offerings in solutions in analytics, cloud computing, and mobile services.
By 2015, the IT outsourcing landscape will see a whole new set of platforms, said Sid Pai, partner, global resourcing and India operations, at Information Services Group, a research and advisory services company. To be sure, “while we are seeing a push in so-called non-linear space, it has not yet translated into real business,” said Pai.

“Nobody has invested sufficiently for developing a software asset with significant applications. Most of them will be largely mobile platforms in enterprises and there will also be a set of new players who will pose a threat to traditional outsourcing models since there will be a change in the balance of delivery,” Pai added.

For instance, with the help of cloud computing, Google Inc., the world’s biggest online search engine, and Amazon.com Inc., the world’s largest online retailer, are more than nibbling at the IT outsourcing pie. They are increasingly hosting the IT infrastructure of large enterprises and especially small- and medium-size businesses at their own data centres, and reducing the IT costs of clients by at least 40%.

Still, offshoring will not die. It will only metamorphose, according to a 25 January report by Credit Suisse Securities Research and Analytics. “While cost advantages of offshoring have reduced, they are still significant. India’s market share is still less than 10%, and its penetration in Europe is especially low.

However, offshore companies have constantly metamorphosed since the early 1990s and will continue to do so,” the report stated.
Sourcing managers must consider the opportunities and risks presented by the convergence of social, information, mobile and cloud when re-evaluating sourcing options, delivery models and vendors, said a 28 January report by research firm Gartner Inc.

Growing cloud adoption will force sourcing managers to reconsider sourcing governance techniques and contracting practices, said the report, adding that revised mobile strategies, such as BYOD (bring-your-own-device, or organiztions allowing employees to bring their own smartphones, laptops to work and access company information and applications on them) and mobile applications availability, will expand IT service sourcing requirements as users demand new services.

Source:http://www.livemint.com/Companies/1ZIgnGcKBiiMlOJIAKNhUI/Indian-technology-companies-sharpen-focus-on-patents.html

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