IT industry still living quarter-to-quarter: Vineet Nayar
On the overall demand environment and decision making among the clients, Nayar feels that IT spending has not fully recovered, but continues to grow. "But some companies are not responding to recessionary trends as customers would like them to do. That is throwing up new opportunities," he said.
Though, there is some recovery in market HCL wants to be cautious in its approach, reports Business Line. "I think the industry is running ahead of itself in making positive noises. We are still living quarter-to-quarter and that is the honest truth," said Nayar. "We are still completely missing the point of what Oracle will do with Sun acquisition, or Xerox with ACS, so we are cautious," he added.
According to Nayar, overall, the IT budgets for BFSI space especially in North America continue to be challenged. "I do not see budgets increasing, but I see a significant churn. Also, there is one more factor that's making a big impact, the new emphasis on hardware companies looking at the services space - and we have seen a string of mergers and acquisitions on that," he said. Nayar feels that the customers are not happy with these changes for various and they are moving out of the so-called vertical integration into the market space.
According to Nayar, the pricing pressure has receded, but HCL has established a new norm that its clients want value for every dollar they spend. The pricing established in October-March time frame is the pricing today, and there is no further negativity on that - so in that sense the environment is stable. "But I am not seeing any signs of price improvements," he said. He expects IT budgets to be flat to negative in 2010.
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