IBM to Renew its Biggest Indian IT Contract, Faces Stiff Competition


IBM, who has captured nearly half of the IT outsourcing market in India, shares a good relationship with Bharti Airtel. In 2009, Airtel presented IBM with a deal worth $1.5 billion to manage all the IT requirements for Airtel across 16 countries in Africa. The very next year, in 2010, another 10 year deal was signed between the companies, this time only to provide IT solutions to Airtel’s employees across Africa. In 2008, Bharti Airtel also outsourced all its IT requirements for its Sri Lanka operations to the software giant.

“This is a significantly political moment with the development of Indian IT majors. Do they have the price competitiveness and capabilities to win such a flagship client away from IBM? If one is successful, this could signify a changing of guard in the IT business,” said Phil Fersht, founder of outsourcing research firm HfS Research.

But the real player in this deal is Bharti Airtel because, compared to 10 years ago, Airtel now have many options in its pocket and the company will also be using this deal to bring current costs and billing rates down.

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