European Market Gets Worse for Indian Outsourcers

Europe outsourcing market reportedly worsened this year for the Indian players because of a weak euro and tighter IT budgets in Europe, according to Forrester Research.
Large Indian outsourcers currently earn less than 30% percent of their revenue in Europe. The figure is far lower if the U.K., which has been faster in adopting offshore outsourcing, is excluded. The U.K. accounted for 16.2% of the revenue of Tata Consultancy Services (TCS), India's largest outsourcer, in the Indian fiscal year to March 31, 2010. The share of its revenue from the rest of Europe was far lower at 10.5%
In some countries in Europe, the labor laws set limits on what can be outsourced by companies, Siddharth Pai, a partner at outsourcing consultancy Technology Partners International (TPI), said on Tuesday.
Cultural and language differences, and discomfort with sending work far away, have also made many European companies avoid offshoring to India, Pai said. These companies would prefer to outsource to European services firms like Capgemini and T-Systems, or to large multinational services companies like IBM and Accenture that have large operations in Europe, he said.
The ongoing debt crisis in Europe, and its impact on the euro and the economy, may now make the continent less interesting for Indian outsourcers, said Sudin Apte, principal analyst at Forrester.
The European market for corporate IT products and services fell by 6.3 percent in 2009, when measured in euros, according to Forrester. The recovery in the European IT market is likely to be slow this year with the IT market growing at 4 percent over last year, which means that European firms will continue to face budget cuts in 2010 and possibly even beyond, Forrester said.
The debt crisis could have a longer-term effect on IT spending in Europe as public-sector organizations try to balance budgets and shed debt, activities that would in turn have an effect on private businesses by a "ripple effect," Gartner said this month. Offshore outsourcing business from Europe has slowed down after the debt crisis, according to TPI's Pai. Even some deals that seemed close to closure 18 months ago are now delayed, he added.
Indian outsourcers that are targeting European IT markets are also hit by the falling value of the euro, Apte said. Between Jan. 1 to June 30 this year the euro depreciated by over 15 percent against the Indian Rupee, which meant that there were fewer rupees available to outsourcers to meet costs in India.
Source: PC World
Full article: http://www.pcworld.com/businesscenter/article/200613/european_market_gets_worse_for_indian_outsourcers.html

Mahindra Satyam BPO in deal with African firm

Mahindra Satyam, formerly Satyam Computer Services, on Wednesday said that its business process outsourcing (BPO) unit has entered into a partnership with Africa’s Direct Channel Holding Ltd. The financial terms of the partnership were not announced.
Under the alliance, Mahindra Satyam BPO will help Direct Channel Holding expand its services in Africa, the company said in a statement.
Direct Channel Holding, a Johannesburg-based BPO, has centres in Durban, Cape Town, Nairobi and Lagos.
Source: Stockmarkettoday
Full Article: http://stockmarkettoday.in/2010/07/02/mahindra-satyam-bpo-in-deal-with-african-firm/

GlobeOp Confirms Contract With European Credit Management

GlobeOp Financial Services SA (GO.LN) Thursday confirmed it will outsource middle- and back-office services for Wells Fargo & Co.'s (WFC) European Credit Management Ltd. unit, a major contract win for the hedge fund administrator.
Source: Wall Street Journal
Full article: http://online.wsj.com/article/BT-CO-20100701-702468.html

API Outsourcing and AOi Announce Strategic Partnership

API Outsourcing, Inc., a leading provider of Finance and Accounting Outsourcing services (FAO), has announced a strategic partnering agreement with the Accounting Outsource Inc. (AOi), a leading FAO provider for the restaurant industry. The focus on this partnership will be to drive even greater levels of back office automation into the restaurants, moving to an eventual "paperless restaurant," to improve operations and reduce costs.
API's automated Accounts Payable Services has been integrated with AOi's accounting services to provide restaurant accounting customers with a streamlined electronic invoice process. This change has resulted in reduced processing time, errors, labor and capital requirements and overall costs, while providing improved access to information maintained in a secure central document repository.
Source: PRWeb
Full article: http://www.prweb.com/releases/AOi/Paperless_Restaurant/prweb4204574.htm

Egypt Named Offshoring Destination of the Year at the Inaugural European Outsourcing Association Awards

Egypt was awarded the prestigious title of Offshoring Destination of the Year at the 2010 European Outsourcing Association Awards held in Brussels last night, beating rivals Philippines, Colombia and Sri Lanka to the accolade.
Commenting on this achievement, H.E. Dr. Tarek Kamel, Minister of Communications and Information Technology said: "This award recognizes the outstanding progress Egypt has made in the last year as a global outsourcing destination. The country's credibility is going from strength to strength amongst European companies and has put its mark on the map of favored global services locations. We recognize the increasing role that Egypt can play in the fast-paced global ICT industry and we are advancing steadily on the way to position the country as a hub for IT innovation and entrepreneurship."
The awards recognize the success of organizations in outsourcing projects and raise awareness of the importance of best practice in outsourcing.
Commenting on Egypt's success at the awards, Martyn Hart, EOA Chairman said: "Egypt stood out for its multilingual capabilities and developments made to its infrastructure. It has proven itself to be both a strong player for European outsourcers and a gateway to the Middle East and Africa."
Through the support of ITIDA and the Ministry of Communications and Information Technology (MCIT), Egypt has shown ongoing improvement in the ICT sector.
The results of these developments have been reflected through numerous reports, with Egypt most recently being ranked sixth most attractive offshoring destination worldwide and number one in EMEA according to the A.T. Kearney Global Services Location Index™.
Source: PR Newswire
Full article: http://www.prnewswire.com/news-releases/egypt-named-offshoring-destination-of-the-year-at-the-inaugural-european-outsourcing-association-awards-97399109.html

Forrester downplays impact of proposed anti-outsourcing laws in US

The recent spate of anti-outsourcing legislations proposed in the US, like Senator Schumer's Bill to tax American companies that route customer calls overseas, will not impact business decisions related to offshoring, according to Forrester Research Vice-President and Principal Analyst, Mr John McCarthy.
His comments come at a time when the buzz around anti-outsourcing has been growing strong in the Capitol Hill. The House passed ‘American Jobs and Closing Tax Loopholes Act' in May and a month later US Senator Charles Schumer announced plans to introduce a Bill that seeks to impose 25 cents excise tax on any customer service call that originates within the US and gets transferred to an overseas call centre. The proposed legislation, if it materialises, would require US companies to also notify their customers when their calls are handled by an overseas location.
Source: Hindu Business Line
Full article: http://www.thehindubusinessline.com/2010/06/29/stories/2010062953240700.htm

The Growth of Legal Outsourcing: Passage to India

India’s legal-process outsourcing industry is still small but is growing fast. In a recent report, ValueNotes, an Indian consultancy, estimated that India’s LPO revenues will grow from $146m in 2006 to $440m this year and $1.1 billion in 2014. The number of Indian firms offering LPO services has swelled from 50 in 2005 to more than 140 today. Investors have spotted the potential. In February, Actis, a British private-equity outfit that specialises in emerging markets, invested $50m in Integreon. Intermediate Capital Group, also based in Britain, has bought an undisclosed chunk of CPA Global.
A lawyer with similar experience at a London law firm might charge up to $400 an hour for the sort of work that a lawyer does in India for $50 an hour. As law firms and corporate legal departments face mounting pressure to cut costs, an increasing number are choosing the Indian option.

Source: Global Services Media
Full article: http://www.globalservicesmedia.com/BPO/Knowledge-process-Outsourcing/The-Growth-of-Legal-Outsourcing:-Passage-to-India/23/12/9767/GS100625308499