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India's BPO share soars over 14 times

While global IT firms witness a drop in their market share in '06, Indian firms, like Infosys and Wipro, take a jump.

india Updated: Jan 21, 2007 01:06 IST

While globally IT firms witnessed an overall drop in new outsourcing contracts in 2006, Indian companies -- such as Infosys, TCS and Wipro -- bucked the trend with a sharp jump of over 14 times in their market share in the past four years, a new study shows.

In contrast to the massive gains registered by Indian service providers, the market share of 'Big Six' global outsourcing majors -- Accenture, IBM, HP, ACS, CSC and EDS declined to 46 per cent last year, from 71 per cent in 2002.

The market share of India-based providers rose to 7 per cent last year, from less than 0.5 per cent in 2002.

According to a new study by outsourcing advisory firm TPI, there are tougher times ahead for the global IT majors as they face intensifying competition from new market players.

"Indian firms are emerging as an attractive and credible alternative to the traditional players and over the next few years they are expected to compete directly with the 'Big Six' for larger value contracts," TPI's EMEA Managing Director Duncan Aitchison said.

The Indian service providers such as Wipro, Tata and Infosys are reaping the benefits of the trend toward single process and specialist deals, the TPI study says.

Indian firms have been particularly successful in the Applications Development and Maintenance (ADM) segment, where they expanded their market share to 36 per cent in 2006 from 8 per cent in 2003.