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  • raju_investor raju_investor Feb 7, 2008 9:08 PM Flag

    Remote infrastructure management is next wave

    Remote infrastructure management is next wave

    $13-15 b revenue by 2013, 3.75 lakh jobs: Nasscom
    Kamal Narang

    Big opportunity: (From left) Mr Vineet Nayar, CEO, HCL Technologies and Chairman, Nasscom-RIM Forum; Mr Som Mittal, President, Nasscom; and Mr Vivek Pandit, Partner, McKinsey & Co, at a press conference in the Capital on Thursday. —

    Our Bureau

    New Delhi, Feb. 7 After Application Development and Maintenance (ADM) and BPO, Remote Infrastructure Management (RIM) could be the next big offshore opportunity for India. According to a report released by Nasscom on Thursday, India is strongly positioned to capture $13-15 billion of global opportunity in RIM by 2013, leading to creation of 3.25 lakh to 3.75 lakh jobs. At present, RIM services revenue for India stands at $3.2-3.6 billion.

    “RIM is a mission-critical service requiring sophisticated tools and reflects high customer confidence and relationships. By increasing RIM services, the Indian IT industry is moving towards becoming a fully integrated service provider,” Mr Som Mittal, President, Nasscom, said.

    The study conducted by McKinsey & Company highlights that the $524-billion infrastructure management services (IMS) industry — that manages an enterprises’ core IT systems, including hardware, software, connectivity and people — could become as important as the ADM and BPO industries that have dominated the rise of offshoring in the last decade. The IMS industry is moving towards a remote delivery model, where services are increasingly being delivered by vendors and captives from low-cost locations.

    Market range

    After discounting for factors such as infrastructure management spend in low-cost countries, defence and government contracts, spend in SMEs, services that cannot be offshored, and value captured by customers, the study estimates the global addressable market for RIM to be in the range of $96-104 billion. If one takes out a $7-billion chunk that is already being addressed by vendors and captives in low-cost locations, the unaddressed RIM market pie works out to $89-97 billion.

    The study concluded that RIM as an industry could realise $26-28 billion in revenue by 2013, with India capturing as much as 50-55 per cent share of this.

    The majority of growth is likely to come from offshoring midrange services, and network towers, likely to account for about 70 per cent of the overall opportunity, during this time. In terms of industries, the banking, financial services, and insurance industries would lead this growth, followed by telecom.

    Advantage India

    “Given its leadership in IT and BPO, India has a substantial head-start over other low-cost locations such as Singapore, Malaysia, Brazil, Eastern Europe, and the Philippines. India-based vendors have increasing scale and maturity, deep customer relationships, access to sound technical infrastructure, and ability to manage a large low-cost talent pool.

    Finally, it’s the convergence of factors such as evolution in technologies and IT architectures, changes in customer behaviours and demand, and developments in the vendor and offshore supply environment, that have propelled the industry at a pace faster, and will continue to accelerate RIM adoption,” Mr Vivek Pandit, Partner, McKinsey & Company, said.

    For India to sustain its leadership in offshoring and realise the full benefits of the RIM opportunity, several challenges must be addressed, the report pointed out. “The central and state governments need to act in unison to address the issues of talent supply and quality, industry benchmarking, and security enforcement, amongst others,” Mr Vineet Nayar, CEO-HCL Technologies, and Chairman, Nasscom-RIM Forum, said.

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    • More co-lier lies and propaganda, co-liers do a lousy job at
      programing which is really paint by the numbers, my experience
      with co-liers attempting to do admin is log disks filled up
      dba crashing and developed world staff having to tell the co-lier that 1/2 the west coast customers are down.

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