A callous government: Karat

NEW DELHI: The four Left parties on Wednesday formally snapped their over four-year-old ties with the Congress-led United Progressive Alliance (UPA) coalition government at the Centre by submitting their letters withdrawing support to President Pratibha Patil.

General secretaries of the four Left parties – Communist Party of India (Marxist), Communist Party of India, Revolutionary Socialist Party and Forward Bloc – met the President at Rashtrapati Bhavan and submitted separate letters to her.

They also submitted a joint letter, requesting her to direct Prime Minister Manmohan Singh to seek a vote of confidence in the Lok Sabha immediately. It was signed by Prakash Karat of the CPI(M), A.B. Bardhan of the CPI, T.J. Chandrachoodan (RSP) and Debabrata Biswas (Forward Bloc).

Later at a joint press conference, Mr. Karat said the UPA government minus the Left support has been reduced to a minority government.

Charging the Manmohan Singh government and the Congress leadership with being “callous” towards the people, Mr. Karat said it was more concerned with fulfilling the commitment made to the U.S. President, George Bush. “We cannot be a party to such a government. The Congress leadership and the government was always looking up to the U.S. but they should have learnt some good things also from America,” he added.

Mr. Karat cited the example of the U.S. government negotiating an additional protocol with the International Atomic Energy Agency (IAEA) which was not yet approved by the Board of Governors but was made available to all members of the Congress and put on the net.

“Obviously, the IAEA cannot have one standard for India and another for the U.S.,” he said. The CPI(M) general secretary sought to know if the Indian government had asked the IAEA to treat the text of the safeguards agreement as “classified.”

“If the government wants to have any credibility, this text has to be made public. The people of the country and our nuclear scientists have a right to go through the text. It is an insult to the Left parties that at first you commit and then do not show the text.”

Claiming that the Congress leadership and the government had “disregarded” the majority voice in Parliament on the nuclear deal, Mr. Karat said the government had not been “transparent.”

Replying to a query if the Lok Sabha Speaker Somnath Chatterjee would be asked to resign, Mr. Karat said it would be for the Speaker to decide.

He said the Left fight against the deal would go on and hoped that the agreement with the U.S. would not become final. On future ties with the Congress, Mr. Karat said the current developments had shown that it would do anything to remain in power.

The Hindu dt. 10 7 2008

Rupee helps, wages bite IT cos!

BANGALORE: India's top information technology outsourcing companies are set to report their first quarter results for fiscal 2008. While the profits are likely to rise, thanks to a weaker rupee, further losses for their major clients, US financial companies, could lead to falling orders.

Infosys Technologies and No. 4 Satyam Computer Services are expected to raise their revenue guidance for the full-year to March, analysts said, adding that they are keen to see evidence of new deals and their pricing. Although Indian outsourcing firms are expanding to Europe, Asia and the Middle East to lower their dependence on the United States, the country still accounts for roughly half of their sales.

The rupee's 6.8 per cent fall against the dollar in the June quarter has helped offset the effect of large wage increases and costs related to getting visas for their staff overseas on margins.

Brokerage Prabhudas Lilladher expects Infosys' margins to drop 34 basis points and TCS to dip 17 basis points this quarter compared to the previous one. Every 1 per cent rise or drop in the rupee impacts the profit margins of Indian software services firms by 30 to 50 basis points, they said.

"In the short-term, the rupee is likely to further weaken against the dollar or remain stable given the exacerbation of both domestic and global negative factors," India Infoline said. Shares in Infosys, which the market values at $24 billion, rose 21 per cent in the June quarter and Satyam added 11 percent.

Morgan Stanley said in a report this month the credit crisis fallout would extend into 2009, and that mortgage asset overhangs would drive additional write-downs for Wall Street firms, such as Citigroup and Goldman Sachs, as they struggle to clean up their balance sheets.

"Clients' postponement, cancellation of IT projects, indecisiveness over IT spending due to uncertainty over global economic growth remain key concerns," Khandwala Securities said in a note. Brokerage India Infoline said it had heard that some large banks, financial services and insurance companies were demanding significant price cuts. "This, along with low-volume growth, manifests a tough operating environment," it said.

A large pool of English-speaking graduates and comparatively cheaper wages had helped Indian firms ride an outsourcing boom for years, but the growth slowed last year when Wall Street banks issued huge write-downs related to the subprime crisis and as the US economy lurched towards recession.

Infosys which reports first results on Friday is likely to see net profit rise 17.6 percent to 12.7 billion rupees ($295 million) in the fiscal first quarter ended June from a year earlier, according to a Reuters poll of 15 analysts showed. Tata Consultancy Services, which reports on July 16, should post a modest 5.5 per cent rise, hurt by its high dependence on the banking and financial services sector.

India's software and back-office services companies revenue growth will slow a little to 25 per cent in 2008/09, down from an estimated 29 per cent a year earlier, lobby group National Association of Software and Service Companies has said.

Indiatimes Infotech dt. 10 7 2008

Accenture India close to half of global count

A key milestone in India’s IT revolution is set to be crossed in months if not weeks, as the country’s share in the global headcount of multinational Accenture’s outsourced services network is set to cross the 50 per cent mark – which means half of the world-wide work-force in the key unit will be based in New Delhi.

The Indian headcount of IBM Global Services is also fast heading for the half-way mark. Sapient, a relatively smaller company focused on IT consulting, crossed the half-way mark years ago. All these companies signify services globalisation, in which India is becoming akin to what China is in manufacturing.

As Accenture inaugurated a new delivery centre in Noida on Tuesday, its sixth in India since a modest start of the delivery centre work in 2003, the total headcount of the Global Delivery Network (GDN) – which is the part of Accenture that competes for outsourced work with companies like Infosys and Wipro – was about 77,000 across 53 countries. Company officials put the Indian part of it at well over 35,000 in six cities.

“We are just a couple of thousands away (from the half-way mark),” Pankaj Vaish, who heads the worldwide delivery centre network for Accenture, told Hindustan Times.

Accenture chairman Bill Green had said last April that the total headcount in India will cross 50,000 in about a year’s time.

Worldwide, Accenture has about 180,000 employees in 49 countries, but the bulk of the staff are consultants and computer systems integrators who work on client sites. The GDN has call centres and business process outsourcing (BPO) workers and in effect works like a company within the company.

(The Hindustan times dt 9 7 2008)

Apple iPhone 3G makes international debut

SAN FRANCISCO: The iPhone 3G makes its international debut Friday in an eagerly-awaited launch expected to boost Apple's fortunes along with its share of the booming "smart phone" market.

Apple stores will open early to cater to throngs of aspiring iPhone 3G owners in more than 20 countries and analysts say sales could pass the billion-dollar mark within days.

IPhone fanatics began camping outside Apple's flagship store in New York City on July 4, while in downtown Tokyo some 30 people had begun queuing on Wednesday.

"I am a huge Apple fan and I'm excited to buy the iPhone, which I find is far better than any other cellphone," said 25-year-old graduate student Hiroyuki Sano who was first in line in Tokyo.

If Sano's anticipation is any indication, Apple's latest device will be a smash hit.

Online orders for iPhone 3G handsets at British telecom carrier O2 reportedly topped 13,000 per second on Monday, overwhelming the website and causing it to crash.

Industry tracker iSuppli predicts Apple might sell as many as two million iPhone 3G devices at the launch.

Apple intends to gradually roll out the coveted mobile phones, which it is billing as twice as fast and half as expensive as the debut model, in 70 countries.

First-generation iPhones are sold in six countries but have been taken to many others and modified to work on local telecom networks.

"It is clear there is a demand for iPhones in many more countries," Apple founder Steve Jobs said while unveiling the new device last month.

It is designed for faster Internet downloads, longer talk times, and takes advantage of the high-speed third-generation (3G) networks to provide built-in GPS mapping.

Early iPhone 3G reviews have been favorable, saying the device delivers as promised but expressing mild disappointment with battery life. The higher performance of the 3G network saps power faster than its predecessor.

Apple will sell iPhone 3G models in the United States for 199 dollars and 299 dollars, depending on memory capacity. The original eight-gigabyte iPhone was priced at 600 dollars when it debuted in June last year.

IPhone 3G prices in some countries will be as low as a euro (1.57 dollars) provided customers purchase multi-year service plans that translate into lucrative long-term revenue streams for carriers.

Apple is continuing its strategy of locking iPhones exclusively to one telecom carrier per country.

IPhone service providers are AT&T in the United States, T-Mobile in Germany, O2 in Great Britain, and Orange in France, where iPhone 3G launches on July 17.

Belgium will evidently be home to the most expensive iPhone 3G devices, which will be priced at 826 dollars (525 euros) and 968 dollars (615 euros) because law there prevents subsidizing hardware costs with service plans.

Apple and numerous technology websites have posted online tips on how to navigate Friday's anticipated buying frenzy.

The second-generation iPhone will let business users send and receive Microsoft Exchange email, in a direct shot at rival BlackBerry made by Canada-based Research-In-Motion.

BlackBerry handsets have long let people "push" work email to the devices using the Microsoft email system.

IPhones are the third most popular "smart phones" in the world, with 5.3 per cent of the market.

BlackBerry claims 13.4 per cent of the market while Finnish handset colossus Nokia dominates with 45.2 per cent," according to research from Gartner.

The popularity of iPhones has led to copying by competitors such as Nokia and Samsung, which have released touch-screen mobile telephones with Internet capabilities. BlackBerry is also planning a touch-screen device.

Apple reported selling six million iPhones as of June. Analyst Gene Munster of Piper Jaffray predicts Apple will sell more than 12 million new iPhones this year and more than triple that number in 2009.

The Economic Times dt. 10 7 2008

India’s top outsourcing cos

The findings of Black Book of Outsourcing 2008 have not been too pleasing for the Indian IT industry. The 2008 list sees several Indian outsourcing companies failing to find their way in the Top 50 list. The list shows how Indian companies are losing their grip over the outsourcing market and also called for better delivery from Indian vendors to improve their act.

Leading Indian companies like Infosys, Hexaware, EXL Service and ICICI Firstsource failed to make the cut this year due to low client approval ratings.

Firstsource (formerly ICICI), a four-year top ranked performer fell the most of any outsourcing company to 1550 of 1690. Indian IT bellwether Infosys too fell out of the Top 50 circle to rank at 59 this year. According to the survey, most of these Indian outsourcers were deficient in their delivery levels.

However, with the losers, the Indian industry also had some winners. These companies with their consistent delivery levels and solid models continued to gratify clients across industry verticals. Here's meeting the top BPOs of India Inc.

Wipro

The first Indian company on the Black Book of Outsourcing list is Wipro. The IT major climbed a few positions to make its entry at no six.

In a year, when several Indian companies slipped ranks miserably, Wipro retained its position. According to the survey, Wipro's reverse outsourcing strategy in the US and UK has helped the company become a hot favorite among US buyers. Wipro's acquisitions are paying off and management is maximising synergies. Survey sees business transformation demands from clients propelling Wipro into a hugely successful 2009.

With over 19,000 employees, operating across nine different locations (India and Eastern Europe), Wipro BPO services include banking and capital markets, insurance, travel and hospitality, hi-tech manufacturing, telecom, healthcare sectors, finance and accounting, procurement, HR services, loyalty services and knowledge services.

Recently the tech major consolidated its entire consulting business under a single umbrella, Wipro Consulting Services. Facing tough times due to rising rupee vis-a-vis dollar and slowdown in its largest market US, Wipro reported its slowest quarterly earnings growth in the last five years as its clients cut back on technology spending.

The company is bidding for 12 contracts worth a total of $1.2 billion to help it meet its goal of becoming one of the ten largest IT companies in the world.

Satyam

Closely following its Indian rival Wipro in the list is Satyam. The fourth largest software services exporter Satyam is placed seventh in the list.

Satyam is the first company to be certified with e-sourcing capability model (eSCM) Level 5. The company recently reorganised its workforce to create almost 4,000 leadership positions, which is 8 per cent of its 50,000-strong workforce.

According to the survey, developing global archipelago of service centers makes this Indian ITO, BPO and engineering giant an annual favorite among customers.

Incidentally, Satyam is also placed at fourth position on the list of top 10 knowledge process outsourcing (KPO) vendors.

With US slowdown crimping outsourcing deals, the company reported an 18.5 per cent rise in the last quarter. The company stated that consolidated net profit for the quarter ended March rose to Rs 4.67 billion ($117 million) up from 3.94 billion a year ago.

However, the company is chasing 20 large deals in the $50 million-$100 million range to beat the slowdown tremors.

TCS

India's biggest software services exporter, Tata Consultancy Services ranks at 15th position in the Black Book Outsourcing list.

The survey states that TCS establishing a service center in Ohio helped it gratify major US clients. The over 100,000 employees and $4.3-bn strong company remains one of the few vendors to still able to sign super-sized contracts of the past, adds survey.

Like its rival Infosys, the company too has kicked off a succession plan to elevate younger executives into the top management cadre. Under the plan, the company has started a new leadership programme for executives in the age bracket of 35-43.

The Mumbai-based company has planned a capital expenditure of around Rs 4,500 crore for the current year. Of this, it will invest around Rs 1,467 crore in equipment and Rs 3,000 crore in land.

The company which derives 50 per cent of its revenues from North America is witnessing margin pressures due to sub-prime crisis and oil and commodity price escalation.

To address the risk, it has increased diversification across geographies, enlarged the basket of offerings and is focusing on enlarging global presence by strengthening global development centres.

Recently, it bagged a $11.5 million contract from the Uganda Revenue Authority to design and install a tax administration system. The project, funded by Belgium, Britain, the Netherlands and Uganda will bring in a new system that will cut costs and processing time while bringing fiscal transparency and financial accountability.

HCL
Noida-based HCL has bagged 21st position in Black Book outsourcing list. Founded in 1976, HCL is among the India's oldest IT startups, founded by Chairman and CEO, Shiv Nadar.

With $4.1 billion revenue, HCL has over 47,100 employees spread across out of 17 countries. The company's BPO unit has over 11,800 employees. It has offices in India, Ireland, UK and Malaysia.

It supports multi-lingual languages that include eight European languages and eight APAC languages. HCL BPO's focus verticals include telecom, retail, banking and financial Services insurance and hi-tech and manufacturing.

Recently, the European aerospace group EADS partnered with HCL Technologies (HCL) as a supplier for its product engineering and technical publication services. The services will be delivered through the company's design center at Bangalore.

In 2007, HCL was ranked at third position in Black Book of outsourcing list for Highest Satisfaction for Business Process Outsourcing. It has also been appraised at Maturity level 3 of People CMM.

NIIT

Founded in 1981, NIIT is the brainchild of two, young Indian entrepreneurs, placed at 36th position in the Black Book Outsourcing list.

NIIT is a first timer on the Black Book list with top scores from clients in banking, financial services and insurance, travel, retail and manufacturing sectors.

The BPO unit of NIIT, SmartServe (NSS) is a wholly-owned subsidiary of NIIT Technologies. Its main operations are based out of Gurgaon with a disaster recovery site in New Delhi.

NSS has a wholly-owned subsidiary in UK which caters to its marketing and customer management requirements.

The company recently entered into a training joint venture with Genpact to nurture talent for outsourcing companies. The joint venture plans to set up training facilities in several Indian cities, including Gurgaon, Hyderabad, Kolkata, Bangalore, Chennai, Mumbai and Pune in the first year of operation.

In phase 2, the JV also has plans to set up operations at other emerging outsourcing destinations like Dalian, Changchun, Shanghai and Xian in China, and Manila in the Philippines.

Patni

Ranked at 45th position in the Black Book Outsourcing list Patni Computer Systems is a provider of information technology services and business solutions.

The survey states that Patni remains steadfast to its offshore model of keeping long-term clientele happy by maintaining low costs while expanding Europe-centric strategies and staff.

With over 15,000 service clients across industries, the company has 22 sales offices across America, Europe and Asia-Pacific, and 20 global delivery centers across the world.

* Indiatimes News Network dt.9 7 08

iGate subdued on outlook

MUMBAI: iGate Global Solutions, part of iGate Corp, has said 2008 will be subdued for information technology (IT) companies due to cutbacks and cancellations on projects.

Phaneesh Murthy, chief executive officer, told a news channel, the budget actual spent of IT firms in 2008 will be lower than budgeted in 2008 and will also be lower than that in 2007.

Some IT companies may end up meeting their guidance numbers and some will not because of what happens with their customer sets rather than the broader market, he said.

"Volume growth is more likely to get affected than pricing. We are not seeing as much of pricing getting affected in the market," the CEO added. Worries for mid-size companies will be because of their client concentration, he added

The Times of India dt. 9 7 08

UAE arrests 3,000 Indian workers for rioting

CHENNAI: Nearly 3,000 Indian workers have been detained at an undisclosed location on the outskirts of the UAE capital, Abu Dhabi, on charges of rioting. ( Watch )

The workers - from Punjab, Rajasthan, Tamil Nadu and Kerala - of a large ceramics manufacturing unit in the emirate of Ras Al Khaimah were rounded up by security agencies after they went on a rampage at their labour camp on Friday night to protest against the poor quality of food being served to them.

Indian ambassador to the UAE, Talmiz Ahmed, confirmed on phone that employees of RAK Ceramics indulged in arson by burning vehicles and destroying furniture and are now under arrest.

Although not all of the nearly 3,000 workers were involved in the fracas, the police took all of them to Abu Dhabi and Dubai in army vehicles.

While there have been strikes by Indian workers in the past in the UAE over poor working conditions and unpaid salaries, which have led to the Dubai riot squad being called in, this is the first time the UAE army has been pressed into service to arrest Indian workers for rioting.

Confirming the detention of the Indians, minister of overseas Indian affairs, Vayalar Ravi, told TOI that his department "is in touch with the UAE authorities". There were people of other nationalities, too, involved in the rioting, he said. "We are trying our best to get the Indians released. The labour officer attached to the Indian consulate is in constant touch with the UAE officials."

The workers have been questioned and their fingerprints taken. Those found to be involved in the violence will be deported after serving their prison terms, a source in the UAE told TOI. Ras Al Khaimah, where the violence occurred, and Abu Dhabi, are among the seven emirates that make up the UAE.

Talmiz Ahmed also said "the workers went on a rampage at their camp over poor quality of food served to them," and added that he wasn’t aware of the exact number of workers detained.

According to Rateesh, an eyewitness, the workers beat up the camp-in-charge, smashed windows and destroyed canteen furniture. Not content, they then came out and set at least two parked vehicles on fire. A few of them were even injured in the melee. During his visit to the UAE in May this year, foreign minister Pranab Mukherjee had urged the Gulf countries to promote social equality for the millions of Indian workers in the region.

(The Times of India dt. 9 7 08)