Market research firm International Data Corporation (IDC) estimates that India's information technology (IT) services market is at upwards of $13.2 billion and poised to grow with companies looking to undergo digital transformation in order to provide superior services to gain advantage over rivals.
The latest example of an Indian IT services firm taking advantage of this momentum is Bengaluru headquartered Wipro which has just signed a $300 million-deal with private lender ICICI Bank to take over the company's digital transformation solutions from Delhi-based IT solutions provider Vara Infotech on an ongoing basis.
What is more interesting in this deal is that Wipro is absorbing nearly 3,000 employees from Vara Infotech along with some of its assets to deliver the services to ICICI Bank.
This could be a new trend for Indian IT services companies under which they use the assets of smaller firms to deliver digital solutions using its own intelligence and experience. We have seen IT firms such as TCS, Infosys, HCL Technologies and Tech Mahindra sign deals where they directly work with enterprises in domestic as well as global markets.
Even more interesting is a study conducted by Wipro Digital in collaboration with Coleman Parkes Research which claims that markets such as the US, UK, Germany, Brazil, Mexico and Canada see timely delivery of digital solutions as a challenge due to underlying factors such as lack of digital talent, non-openness to working in newer ways, rigidity of business models or legacy infrastructure and lack of leadership skills.
Another important aspect of the deal is the revenue Wipro will make with Vara. The figure justifies reports from several agencies that India presents a large market opportunity for digital solutions. While several of these Indian IT services firms continue to focus on growth markets such as North America and Europe, they could soon be looking at India as their growing market. Large global IT services firms such as IBM, AWS and Microsoft are already focusing their workforce to deliver solutions specific to Indian enterprises.
More deals, partnerships on expanding digital solutions, learning
Some of the other deals and partnerships signed on Thursday includes Tech Mahindra signing a deal with communication services provider AT&T in Dallas to modernise its network systems and cloud migration operations and Microsoft partnering with educational board CBSE to train teachers on cloud-powered technologies. The Windows-maker also delivered a chatbot solution to private lender Yes Bank on Wednesday.
At the global level with venture capital firms such as Bertelsmann showing interest in technologies such as AI and cloud computing, data protection and information services provider, Commvault, is looking at strengthening its solutions via acquisitions. While Bertelsmann said that it would look to fund 15,000 scholarships on AI and cloud computing via learning services provider Udacity, Commvault snapped up data sovereignty solutions provider Hedvig for $220 million.
The move comes at a time when the adoption of cloud environments and cloud-native applications is gathering pace and the rapid growth of data over the cloud has created governance, security and management challenges.
While most enterprises are taking the help of IT service providers, there are companies who are bent on developing technology capabilities internally. One such company is Airbus which announced on Thursday that it would be opening a new IT facility in Bengaluru comprising 500 people to expand its digital capabilities across the globe. India makes a perfect market to open such a facility due to a large pool of engineering talent and lower cost of employment.
In today's news
The partnership and deal momentum continues on Friday as announcements come in from IT service providers such as TCS. We will also be taking a look at critically understanding a few of the studies and surveys published by these firms which talk about cybersecurity and voice computing. The big feature from us today would be around ABB. We will be looking at how the company is using technology to deliver better solutions and increase its productivity.