IT firms eye $30 Billion global outsourcing deals

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IT firms eye $30 Billion global outsourcing deals
Bangalore: As outsourcing customers in U.S. and Europe seek to renew their computer infrastructure management contracts worth $30 billion, Indian tech firms like HCL, TCS and Wipro are bidding against rivals IBM and HP for their share of the opportunity, reports Economic Times.

The top 15 vendors analyzed by research firm Forrester in a recent report provided remote and onsite services for about 16.7 million desktops, 1.7 million servers and 23.4 million users globally. These vendors, including IBM, HP-EDS, CSC and some Indian tech firms delivered $83.9 billion worth of infrastructure services last year.

By outsourcing the management of their desktops, computer servers, storage and communication infrastructure, customers such as Nokia, Xerox and Citigroup plan to have leaner balance sheets, reduce their operational expenses by upto 40 percent and focus better on their core business.

According to Economic Times, around three outsourcing consultants involved with helping customers outsource infrastructure management said that nearly $30 billion of such contracts are up for renewal in 2010, and almost a quarter of these contracts will go to new suppliers, with the rest to be renewed with incumbents IBM and HP-EDS. "In last two years, we have demonstrated our capability to take over from incumbent providers," said Anant Gupta, President of HCL's infrastructure services division. "Despite remote infrastructure becoming popular, there were doubts about whether we can provide global support - our recent wins have proved that we can."

Among large outsourcing contracts for infrastructure management, HCL signed $350 million seven year deal with Readers Digest this year, apart from deals with Nokia and Xerox. Wipro acquired Citi Technology Services for around $127 million in December last year, which came with Citigroup's commitment to outsource all future infrastructure management contracts to Wipro, potentially worth almost $1 billion over six years.

Experts such as Diptarup Chakraborti, Principal Research Analyst at Gartner say that Indian tech firms have already become multinationals by hiring more local workers, which will help them gain large contracts.

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