Perot Systems plans domestic IT services

Feb 14, 2007

Perot Systems plans domestic IT services

US-headquartered Perot Systems is all set to enter domestic IT services market joining the ranks of multinationals such as IBM, Accenture and Hewlett Packard, which are now actively competing for some of the large deals in the Indian market. US-headquartered Perot Systems is all set to enter domestic IT services market joining the ranks of multinationals such as IBM, Accenture and Hewlett Packard, which are now actively competing for some of the large deals in the Indian market.
A senior official with the company said Perot could no longer afford to ignore the Indian market and that a proposal to start offering IT services to the domestic market was under active consideration. "The domestic IT market is still small but we can't afford not to have a presence here," the official told ET.
Deals such as the Bharti-IBM contract that has scaled up to a record $1.6 billion, has made the Indian market more attractive for mutlinational vendors that were so far using India only as an offshore base for overseas contracts.
Perot, for instance, has been in India for over 10 years now and is present in four cities. Its fourth centre was set up last year in Coimbatore, taking the manpower strength in India to about a fifth of its global workforce. Its visibility in the country has not been very high compared with some of its peers but the company is now changing that.
It was one of the sponsors of the high profile Nasscom Leadership Forum held in Mumbai last week. "It's desire to increase visibility could be a sign that it wants to play a greater role in India," an industry watcher said.
According to research firm Gartner, Indian ICT spending is growing at a five-year CAGR of 14.8%, the highest in Asia Pacific region and is projected to exceed $36 billion by 2009. "The success of some of the older deals such as the Bharti-IBM, Dabur-Accenture and Bank of India-HP has set the stage for more. You will see a flurry of deals as we head into 2007 and 2008," Gartner India research V-P Partha Iyengar said.
Unlike some of the earlier resource augmentation contracts, these are strategic outsourcing deals where the client relies on a strong partner to provide it with services it does not have the bandwidth to do itself, according to Mr Iyengar.
In an added advantage to the incumbent vendor, if the initial contract is successful any scope for enhancement and expansion is also likely to go to the same vendor. "In the global scenario, clients have the maturity to source to multiple vendors and the contracts are larger. But in the Indian context, this is not likely. There is cost associated with shifting your vendor," adds Mr Iyengar.
A senior official with the company said Perot could no longer afford to ignore the Indian market and that a proposal to start offering IT services to the domestic market was under active consideration. "The domestic IT market is still small but we can't afford not to have a presence here," the official told ET.
Deals such as the Bharti-IBM contract that has scaled up to a record $1.6 billion, has made the Indian market more attractive for mutlinational vendors that were so far using India only as an offshore base for overseas contracts.
Perot, for instance, has been in India for over 10 years now and is present in four cities. Its fourth centre was set up last year in Coimbatore, taking the manpower strength in India to about a fifth of its global workforce. Its visibility in the country has not been very high compared with some of its peers but the company is now changing that.
It was one of the sponsors of the high profile Nasscom Leadership Forum held in Mumbai last week. "It's desire to increase visibility could be a sign that it wants to play a greater role in India," an industry watcher said.
According to research firm Gartner, Indian ICT spending is growing at a five-year CAGR of 14.8%, the highest in Asia Pacific region and is projected to exceed $36 billion by 2009. "The success of some of the older deals such as the Bharti-IBM, Dabur-Accenture and Bank of India-HP has set the stage for more. You will see a flurry of deals as we head into 2007 and 2008," Gartner India research V-P Partha Iyengar said.
Unlike some of the earlier resource augmentation contracts, these are strategic outsourcing deals where the client relies on a strong partner to provide it with services it does not have the bandwidth to do itself, according to Mr Iyengar.
In an added advantage to the incumbent vendor, if the initial contract is successful any scope for enhancement and expansion is also likely to go to the same vendor. "In the global scenario, clients have the maturity to source to multiple vendors and the contracts are larger. But in the Indian context, this is not likely. There is cost associated with shifting your vendor," adds Mr Iyengar.