Tuesday, September 05, 2006

Offshore Software Development is facing stiff competition

Offshore Software Development is facing stiff competition with the entrance of the new players in the market. New players are in terms of the new IT Companies as well as new countries that are trying to create impact for themselves as an Offshore Outsourcing service provider. Along with this offshore market, local market for IT services is also becoming competitive. Presence of IT Companies in every local market is also increasing. Two IT giants India and China alone has the most of the global IT Market share and cover the big share of Offshore Software Development market. Both the countries have thousands of IT Companies that are offering many different types of development and other IT services. In both of these countries the growth of Information Technology Industry is remarkable.

As far as India and China are concerned for IT services, both the countries are in close competition with each other. The IT market globally is becoming very competitive as the inflation rate is going up. Though, India and China are considered to be the most cost effective service providers for all types of software services. Now-a-days other players such as Philippines, Russia & Nigeria are also trying hard to make impact for themselves. Still among these all players India is still the first choice globally for its lower labor cost IT services. India also has a great advantage of fluency over English language and that is the main reason that India has edge over the others for all types of Information Technology services globally.

Offshore Software Development

As mentioned earlier the global market is becoming tough and very competitive for Offshore Software Development and all types of IT Business because new entrance are offering services at very lower rate. But apart from the lower cost, quality of the services is also a key point to make the Offshore Outsourcing deal successful. It is also marked that many of the companies have failed in the market due to the lower quality services. So the quality of the work must also be maintained. Though, most of the IT Companies are earning well as a part of the Offshore Software Development. This is the main reason for increased competition in the offshore IT market.

Survey also suggests that 29-30% of the IT companies do cover their investment and start earning within two years of investment. Again 40% to 45% of the companies are also gaining higher than their investment within short period of time. Still many of the companies also fail in the market due to the lower quality Offshore Software Development services. The market for Offshore Outsourcing is increasing rapidly not only in IT Industry but for almost all the industries worldwide. Among these, country like India has also become the hot spot for Offshore Software Development services worldwide. Boom of overseas software and other IT development job work has changed the global scenario.

Increased competition worldwide for possible IT services has made it tough for the companies to sustain their position in the market for Offshore Software Development.