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TCS-Nielsen deal is a thumbs up for Indian IT, says Nasscom

Nasscom is bullish that global businesses who relied on Indian IT industry in the past would continue to offer opportunities for their digital transformation as well.

, ET Bureau|
Dec 27, 2017, 09.03 AM IST
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TCS, India’s largest software services exporter, bagged a renewal deal worth $2.25 billion spread over five years.
BENGALURU: A large deal win by Tata Consultancy Services (TCS) from market research firm Nielsen, which constituted nearly 50% digital technology work, reaffirms the confidence of clients in Indian IT industry, said R Chandrasekhar, president of Nasscom.

Nasscom, the lobby for IT services companies in India, is bullish that global businesses who relied on Indian IT industry for their technology work in the past would continue to offer opportunities for their digital transformation as well.

TCS, India’s largest software services exporter, bagged a renewal deal worth $2.25 billion spread over five years and a senior executive told ET that close to half of the scope of work with Nielsen this time would involve use of digital technologies such as automation and data analytics.

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“They (clients of Indian IT industry) are slowly moving a lot of the traditional spend into newer technology areas on the digital side and since those decisions are not easy to take and particularly difficult for a nontechnology company, they prefer to do it with their partners who are tried and trusted,” Chandrasekhar told ET, adding that their IT services partners are well-placed to pivot the digital technology transformation across businesses.

The $154 billion Indian ITBPM industry is seeing higher demand for services that can simplify customer experience, operations using emerging technologies such as cloud computing, artificial intelligence and machine learning.

“Indian IT industry has been their partners in technology (implementation) in the past and they have built a certain level of confidence in the client, they understand the business and the processes and therefore they are very wellplaced to really help them (clients) to strategise how to take maximum advantage of the new and disruptive technology to boost business,” he added. Companies such as Infosys, TCS, HCL Technologies and Tech Mahindra saw digital technology services largely making up to 17% to 22% of the total revenues in the past year. Wipro said it got 24.1% revenue from digital technology. There may be, however, some catching up to do since larger peers such as Accenture garner more than half of the revenue from digital. This has forced IT services firms such as TCS, Infosys, Wipro, HCL Tech, Accenture and IBM to pivot the traditional model of service delivery to serve customers to cloud-based service delivery.

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