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India Is Entering The Third Phase Of IT Boom

By SiliconIndia   |    1 Comments
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India is now entering a third phase of the IT boom (started with Software development, then came BPO/Call Center), development and introduction of Software Products by Indian companies. India itself is emerging as a big captive market for the product companies – 3G, 4G, LTE and broadband addressing the connectivity issues, availability of better physical infrastructure such as power, launch of low cost PCs, laptops, tablets and smart mobile phones, all these provides a great opportunity to introduce software products in the internet and ecommerce space.

The future of IT is going to be shaped up with how much businesses can optimize products and services on the Cloud, Mobile and Social spaces. According to a Gartner survey, by 2015, low-cost cloud services will eat up the top outsourcing players' revenue by 15 percent. The market will become extremely price competitive, resulting in speeding up the transition towards cloud based services. Innovation and proper utilization of one’s resources to grow in these areas will take one to the next level in IT industry.

Another big change in the IT industry might be that the “pay as you go” model will most likely replace the traditional licensing model. The big names in Software industry are interested in moving to models where they do not have to negotiate on their costs but instead give what the CIO demands. Hence, the companies will be able to use only what they pay for. Also, SaaS (Software as a Service) will emerge as the preferred model of delivery going forward. According to Gartner, it will see a continuous healthy growth through 2015, when worldwide revenue is projected to reach $21.3 billion. An increasing interest in SaaS platform will trigger this growth and keep it moving.

The main challenges entrepreneurs will face in this present scenario will be, rising interest rates of working capital, over cautious approach of Venture Capitalists and PEs to fund new projects, and the negative market sentiments due to the recent currency troubles in Euro zone, stock market fall, and decelerating growth in emerging economies. But, then again, these difficulties also present opportunity for businesses, especially in the markets where the competition might have weakened.

The article is authored by Chairman and CEO of Indusface.

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Reader's comments(1)
1: Excellent forecast on IT Future in India.
Dr.A.Jagadeesh Nellore(AP),India
Posted by:Dr.A.Jagadeesh - 05 Feb, 2012