‘ASPs will find it cost-effective to operate from India’

With IT research firms predicting a consolidation in the ASP market in the
US, do you believe that Indian ASPs are headed towards a phase of consolidation?

The Indian ASP market is still at a nascent stage. While IT outsourcing has
prevailed for some time now (earlier known as offsite development), the actual
ASP work (application delivery and servicing) also termed as ‘back-office
management’, is yet to make a breakthrough in the Indian market. However,
given the low barriers, the high level of interest and entry of large
organizations, added with low management and maintenance costs, ASPs will find
it lucrative to operate from India. Mergers and acquisitions will also play a
part in growth.

Between SMEs and large businesses, which holds greater potential in India?

While the SME segment will benefit most from ASPs, international trends show
even larger organizations moving to outsource resources to ensure a focus on the
primary area of competence. Similarly, as India moves towards globalization of
its economy, it is critical that SMEs upgrade and integrate systems to
international partners to allow easy access, accountability of operations with
suppliers, vendors and sales-force.

To what extent is customization done in India, when offering services to
clients?

The primary responsibility of an ASP is to ensure reliability, availability
and security of access to application and data across a large customer base
operating from a central server. Therefore, customization limitations prevail.
However, it is important to note that most applications are standardized to
specifics, taking into account statutory and legal issues, which is acceptable
to a large proportion of customers.

Besides, it is this level of standardization that allows tremendous benefits
to customers in terms of speed of deployment, auto-updates and upgrades, systems
maintenance, quality of service and security, among other aspects.

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