'Indian IT firms need long-term deals to make gains in Europe'
By siliconindia   |   Wednesday, 04 February 2009, 00:04 IST   |    3 Comments
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Bangalore: Indian IT majors are still finding a major share of their revenue from European market through project services, while most of the MNCs prefer to go with long-term outsourcing contracts. Top Indian IT companies like TCS, Infosys and Wipro will have to shift focus on long-term outsourcing in order to make significant gains in the European market, says IT analysts. These three companies derive around 25 percent of their revenue from European market. Unlike Indian firms, MNCs such as IBM and Accenture along with the European-headquartered players including Capgemini, Atos Origin and Logica are making a large share of their revenue from European market as part of multi-year contracts. "A fall in project services spend is impacting all service companies irrespective of where they are headquartered," said Kate Hanaghan, Senior Analyst, The Bathwick Group. An official of a top Indian IT firm opined, "We surely need to increase the share of bigger, long-term contracts in order to gain competitive edge." "The revenue contribution from Europe is expected to remain at same level as Indian companies will be wary of making any substantial investment in the region under the current circumstances," said Dr Pradeep Mukherji, Managing Director, Avasant Asia, a sourcing advisory firm.

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