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India’s software biggies eye IT hardware market
It has been a rather prolonged pain for the Indian software services exporters since the subprime crisis surfaced a year ago forcing them to restructure their business models to counter the downturn.
However, it now seems that hardware could be software’s best bet to surf through the economic slowdown.
You don’t usually buy your PC laptops or set top box from Indian IT companies but soon that may be a possibility.
This could be possible as the Indian software majors like TCS and Wipro key in for a hardware play so much so the next big acquisition for the largest Indian software company TCS could be in the hardware space.
"The organisations who are willing to do hardware and software together will be successful in future. In sectors like power, railways and engineering, a lot of hardware is required to provide solutions," said S Ramadorai, CEO, TCS.
Ramadorai also said that TCS would not hesitate to look at inorganic growth route to expand its business further.
TCS sometime back had acquired its group company Tata Infotech's ATM manufacturing unit in Goa and it also makes work-stations for e - governance projects.
Wipro has undertaken set top box manufacturing and is developing various mobile equipments as well. Rolta is setting up a manufacturing plant for defense communication devices and sensors.
"With the slowdown in the US economy the focus is now shifted to the domestic market where the internet, TV, mobile penetration is still low," said Vinnie Mehta, ED, MAIT.
It is not just the $10 billion domestic market growing exponentially that is attracting the software players other emerging markets like Africa and Brazil pose a huge opportunity as well. The IT companies know well that only way they can sell software there is by bundling it up with hardware.