IT Firms In India Gaining Market Share Over Competitors in 2010

February 16, 2011

Despite the fact that the total worth of offshore contracts for 2010 have declined, India’s IT companies appear to be gaining market share from their competitors.

Analysts looking at big deals say that new contracts for this year was down 11%, the TPI index reported. TPI is the biggest sourcing data and advisory firm. The TPI index has accounted for deals with a minimum contract value of $25 million.

In addition, BPO contracts, comprising of 22% of the total amount of deals of this year, declined 31% for the year 2010 to $17.8 billion. In the last three months, just $2.8 billion worth of contracts of BPO deals were handed out. This figure is down 63% from the same period in 2009.

Outsourcing, a flagship industry for India fared better with just a 4% decline for the whole year. For the year 2010, deals worth 61.2% billion were awarded in 2010.

Nonetheless, big companies in the U.S. and Europe are restructuring and renegotiating IT contracts that are in effect now. This provides big name Indian outsourcing firms like Tata Consultancy Services and Infosys a better outlook versus competitors in terms of obtaining future contractors. their competitors include majors like IBM, Computer Science Corporation and Accenture.

According to the most recent TPI index report, one third of the market was restructuring related. The report added that it expects 2011 to include more restructuring efforts. Sid Pai, Managing Director of the Indian Division of TPI, said, Indian firms were gaining share in large deals, where they were one among several vendors. 2011 will present more opportunities for Indian vendors to play out this activity more and more.

Just in the fourth quarter, $6.3 billion of restructured outsourcing deals were handed out to Indian firms.


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