Industry Analysis IT and ITES

1
Industry AnalysisIT and ITES

• Prabhdeep Singh
• Pradeep Sangatramani

2
Introduction

• IT fastest growing sectors
• Key segments software and services

3
Evolution

• IT
• 1968 The Tata industrial conglomerate forms
  software services unit Tata Consultancy Services.
  
• Mid-1970s IBM exits India. Import duties of 150
  percent or more mean that VCRs cost 3,000 and
  TVs cost 6,000. Wipro starts to create India's
  first homegrown PC.
• 1994 Telecom liberalized.
• 1995 TCS determines that its CasePac tool
  developed for IBM can be used to scan software
  for Y2K problems. An industry is born.
• 1999 Y2K contracts pile into India.
• 2002 Indian companies expand hiring. Massive
  layoffs in US
• 2003 Led by service conglomerates such as Wipro
  and Infosys, India becomes a primary destination
  for offshore outsourcing as foreign companies
  seek to lower cost.
• ITES
• First Phase MNCs establishing units in India
  (Pre 1997)
• Second Phase Entry of established software co.
  (1997 2002)
• Third Phase Geographical dispersion of
  Activities (2002-2004)
• Fourth Phase Move towards acquisitions ( 2004 -
  )

4
IT Primary factors

• Cost
• Labor cost
• Infrastructure costs
• Exchange rates
• Labor competitiveness
• Size
• Level of education
• compatibility
• Other Factors
• Business and political risks
• Geographical location
• Regulatory considerations

5
Global Comparison.
6
Global Comparison
7
Major Players
Top 4 companies have 80 market share
8
Future Trends
9
Future Trends

• Increasing Labor costs
• Moving up the value chain
• Consolidation
• Manpower Shortage
• Outsourcing Backlash
• Engineering Services Outsourcing (ESO), Avionics
  and other opportunities

10

• THANK YOU