The 2007 is over, what a year it has been for the outsourcing business, a true topsy-turvy ride, Indian rupee has appreciated against the US dollar impacting both global IT service providers and customers. Managing currency risk in offshore outsourcing has suddenly become a super hot issue in the board meetings.
So far this year, rupee appreciation has eroded about 11 percent of the dollar’s purchasing power in
This is the real challenge for “easy money making” Indian software oligarchs. Can the call centers and IT companies survive? Experts say, the Indian IT companies and call centers for the first time will learn to compete in fair play ground and those who are really efficient will survive. Most of Indian IT and Call center companies survive by unfairly taking advantage of artificial currency differential between US Dollar and Indian Rupees. That is what is going to come to an end.
Outsourcers are indeed got hit by the trend
The appreciation of the Indian rupee against the U.S. dollar is affecting the margins of Indian outsourcers, the president of a trade association said Thursday.
It's a difficult time for Indian outsourcers as they are already struggling with rising staff salaries, Kiran Karnik, president of the National Association of Software and Service Companies (NASSCOM), said Thursday.
On merger and acquisition front we saw Affiliated Computer Services tried to go private for the second time and failed.
Indian players have been on a buying spree. Some big deals were signed. TCS has signed a $1.2bn IT service deal with The Nielsen Company, supposedly the largest offshore contract these days.
In the following posts, I will try to write some outsourcing predictions for 2008.
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