| Lucknow, the next vibrant IT-BPO hub |
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With saturation, chaos, high attrition and spiraling land and rental costs playing havoc with the growth curve of some top IT-BPO destinations in the county, following which many players have started looking at promising tier-2 cities for expansion and investments, the National Association of Software and Services Companies (Nasscom) has come up with an initiative of launching Lucknow as one such promising city which has all the requisites to emerge as a premier tier-2 destination for IT and BPO industry.
Based on a recent report by Nasscom and AT Kearney on 50 locations in the country, which had assessed Lucknow as a 'challenger', the best category after the top 7 existing IT destinations, the initiative will try to bring forth the fact that it has all the requisite qualities necessary for setting it up as an IT-BPO hub: availability of abundant talent, good social infrastructure, excellent quality of life and lower cost of living and operations.
As part of the initiative, Nasscom is planning to provide an interactive platform for the industry, the state government and the academia to discuss and strategize a roadmap for Lucknow to emerge as a premier IT-BPO destination in a conference on August 30. While the state government would be represented by senior government officials, the chairman and the president of NASSCOM would also be present at the meet along with CEOs of several IT-BPO companies.
Talking to FE, Jayant Krishna, principal consultant of TCS said that an effective public-private partnership is required to enable the city top gear up for a fast track development leading to its emergence as an IT-BPO hub. "The state government, the industry and the Nasscom need to work together hand-in-hand to turn this vision into a reality," he added.
Source: The Financial Express |
Banking and financial services sector driving the outsourcing industry |
The outsourcing industry has given impetus to inflow of foreign exchange and creating job opportunities in India. The financial services sector has emerged as a key domain for outsourcing.
Work Flow and Growth Prospects
Banking, financial services and insurance (BFSI) comprise 38 per cent of the outsourcing industry in India (worth $47.8 billion in 2007). Most of the work outsourced comes from the US followed by Europe. According to a report by Mckinsey and Nasscom, India has the potential to process 30 per cent of the banking transactions in the US by the year 2010. Outsourcing by the BFSI to India is expected to grow at an annualised rate of 30 - 35 per cent. Outsourced services from the BFSI domain include customer support, software and solutions required for core banking, various banking processes like mortgage loan processing, application processing, verifications etc, and other services like market analysis, financial statement analysis etc.
The Indian Edge
While the major driver of the outsourcing wave is the cost advantage India enjoys in terms of employee cost, comparatively lower rentals for space etc., western outsourcers opt for India for various other reasons like better management, focus on core areas where they specialise, quality, service etc. According to Ramesh Mengawade, CEO and Chairman of Opus Software Solutions, a third party processor for credit, debit and prepaid cards, "outsourcing in card processing enables our clients flexibility and time to market advantages for introducing new features and enhanced security due to stringent regulatory compliance."
Future Outlook
Recently the Financial Services sector in the US has been under a lot of pressure on account of the sub-prime crisis, due its exposure to securities backed by real estate assets. This has resulted in uncertainties regarding the flow of work from this sector to India. There is a view that the slowdown in the US will affect the IT and BPO industry adversely while there is another school of thought that the slowdown would eventually benefit India as companies will outsource more work to check their costs. It seems that the growth for companies with outsourcing jobs in the financial sector is here to stay in spite of the recession in the west and like in the past Indian companies will raise their standards to meet the requirement of their clients across the globe.
Source: The Economic Times |
| India evolving as favoured destination for data hosting services |
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With impressive domain skills, an amalgamation of technologies and decreasing bandwidth tariffs, India is rapidly evolving as favoured destination for data hosting services and remote infrastructure management (RIM) site for global companies. Firms from Europe and the US are looking at Indian companies for the management of their data, servers, carriers, and disaster-recovery operations as well.
As India scores high on reliability, data protection and security, many domestic and international enterprises have relocated their data facilities like servers, storage devices and remote IT infrastructure to Indian service providers. Internet companies and web portals like Rediff.com and Indiainfoline.com are among them. Leading Indian companies like Reliance Infocomm, Tata Telecommunications, Sify and Netmagic Solutions will be providing a host of IT-managed services like mission critical applications, data hosting, networking and RIM back-office operations to local as well as international firms. With the enormous business potential in operating captive data centres, IT bigwigs like TCS, Infosys, Wipro and HCL have also offered to manage hosting and RIM services to their global clients.
With foreign institutional investors (FIIs) opening Indian offices, and the entry of many investment banks and global marketing and research firms, there is huge demand for data centres. Likewise, the massive growth of the telecom sector and mobile and Internet services has created many opportunities for data service providers. Netmagic founder and CEO, Sharad Sanghi, said, "Earlier, enterprises preferred data centres to be nearby, to see, touch and feel secure. Firewalls, security solutions and filters have ensured data centres can be location neutral or even remote."
"Enterprises are realising there are tangible benefits in outsourcing their data requirements to third parties, which alleviate risks posed by security breach, theft and man-made disasters like 9/11 or natural disasters such as earthquakes, floods and so on," he stated. "Though market research firm IDC has estimated the Indian data centre market size to be about US$ 150 million, we see a huge potential to double and triple the market over the next three-five years," he informed.
Source : IBEF |
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Rural wireless broadband to be rolled out by year-end
Wimax is short for worldwide inter-operability for microwave access, a standard that is capable of data speeds of 10 megabytes per second up to 2km away from a radio transmitter. The first rural rollouts of wireless broadband powered by the so-called Wimax protocol could take place before the year-end, a top executive of government-owned phone firm Bharat Sanchar Nigam Ltd, or BSNL, said.
“We are planning on installing WiMax capabilities in 1,000 blocks out of the total 6,000,” said Kuldeep Goyal, BSNL’s chairman and managing director at an industry meet here. “Proof-of-concepts, for which we’re working closely with a number of vendors, are being installed, and will hopefully be completed in the next few months.” A block refers to an administrative grouping of villages, at times around a town. Wimax is short for worldwide inter-operability for microwave access, a standard that is capable of data speeds of 10 megabytes per second up to 2km away from a radio transmitter.
The wireless broadband rollout will bring Internet connectivity to what are called Common Service Centers, or CSCs, computer kiosks equipped to provide e-governance services related to health, education and agricultural information, and designed to provide connectivity to citizens. Under the plan, nearly 100,000 CSCs, covering 600,000 villages, have been approved at a cost of Rs5,742 crore over four years. Goyal estimates CSCs in 25,000 villages to go live over the next year.
Source : livemint.com |
IT firms' sales may touch $11 bn by 2015
The IT industry, dominated by software services and BPO segments, is rapidly seeing the emergence of product companies and a latest study projects that India could account for roughly 2%, or $11 billion, of global product business by 2015. In the first-ever survey of India's software products segment conducted by Nasscom along with Zinnov Consulting, the study lists 371 companies in this sector with two-thirds of them being less than three-years old. These companies together had a combined revenue of $1.4 billion in FY’08 growing at 44% CAGR in the last three years. The Nasscom-Zinnov study has projected that India’s software products space may touch $11 billion by 2015.
This could mean that Indian companies will be accounting for nearly 2% of the overall global products business estimated at $500 billion by then. Interestingly, at present, the top 10 companies accounted for around 85% of the existing industry revenue, with the top five including Finacle of Infosys Technologies, i-flex, Subex and TCS products division, forming the bulk of it. The Indian software products space, according to the survey, is defined thus: The company must be registered in India and have an IP. It must have a tangible brand character and it must be an end product reaching the customer/client. Nasscom-Zinnov says India’s software products story, mainly on the application side, will be vertical focused unlike its global peers that have horizontal spread. In fact, some of India’s leading companies are heavily or exclusively focused on verticals—Subex on telecom, Finacle and i-flex on banking.
Nasscom has identified about 10 key verticals where Indian companies may do well. Among them, business intelligence, BFSI and telecom have already emerged rather strongly. Key challenges for the sector include funding, especially paucity of venture capital, and attracting talent. Though it’s a long haul for many of the product companies to gain the traction at the marketplace, there is no particular linearity in this business. However, IT services companies are also getting into this segment by increasingly "productising" their offerings, which could mean higher revenue without actually adding the necessary headcount.
Source :
The Economic Times |
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