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From widening currency gaps to industry mergers and acquisitions to an expanding range of outsourcing services and destinations, the new year should keep IT service providers and customers on their toes.
It's been a dynamic year in the information technology outsourcing industry. The Indian rupee rose to record levels while the U.S. dollar declined against most major currencies, impacting global IT service providers and customers alike. Merger and acquisition activity went into high gear (with the exception of poor Affiliated Computer Services, which tried—and failed— for the second time to go private). The consolidation activity was most notable for the inroads Indian providers made into the U.S. market by buying local providers. And Mumbai-based Tata Consultancy Services announced a $1.2 billion IT service deal with The Nielsen Company, technically the biggest offshore contract to date, hinting at the increasing maturation of the outsourcing market. Buyers of IT services also began to look beyond India to balance their offshore outsourcing portfolio, from Shanghai to São Paulo and more than a few spots in between.
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