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We will encourage our customers to move to the SaaS model

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DQI Bureau
New Update

How do you see the market for OPD? If you look at 2008 as a segment in

outsourcing, how did OPD perform?



Typically the OPD market has been viewed as a stable and steady market. In

India the OPD market can be divided into three segments: large MNCs who have set

up captive centers; mid-size product companies who outsource their ODCs; and

venture funded startups that outsource their projects. However, there is often

an overlap between these segments. For instance, many MNCs maintain ODCs with

Indian vendors despite having their own captive centers. More than 70% of the

OPD business in India is from captive centers. The second half of 2008 has been

a tough year for all segments within the OPD space. My view is that 2009 will

see the OPD market slowing down even further. In 2008 the OPD division of

Calsoft grew by 29% but we do not expect the same momentum in 2009.

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What are some of the major outsourced product initiatives you have worked

on?



Recently we have formed a partnership with Ixia along with a five year OPD

contract. Ixia is a global leading provider of performance test systems for

IP-based infrastructure and services. We are providing critical end-to-end

support for development, testing and sustenance for the Ixia product lines. In

addition, Calsoft has dedicated labs and ODCs for many customers including Blade

Technologies, Kronos, Symmetricom, etc, at its Chennai and Bangalore centers,

that address the entire spectrum of OPD activities for design, development and

testing to maintenance.

Given the tech meltdown, are you seeing any impact on your business?



The US has been our main market and a slowdown in its economy will impact

our sales. Our outlook for FY 2009 is cautious. We expect to generate more

business from our relationships with industry players like Ixia with whom we

have partnered. We will need to develop more such relationships. In this

scenario the one clear change that I see happening is in the nature of the

relationship between OPD companies and their customers. As customers push

companies for more value for money and accountability, OPD service providers

will transition from being a mere vendor to becoming a partner. The onus of

sharing the risks and rewards will fall on both. Our growth engines in OPD would

be next generation data center and embedded engineering. We will encourage our

customers to move to the SaaS model and cloud computing architecture.

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Can you elaborate on your product engineering and product based business

solutions? What is the model, USP, and client advantages?



The product engineering market is very different from the traditional IT

services market. In the case of IT services the customer does not see it as a

core part of their business, and hence, is keen to outsource it if the benefits

are clearly visible. However, in the case of the product companies, product

engineering is their core business. Hence the decision to outsource cannot be

taken lightly. Further a product goes to a large number of users and would need

to be upgraded frequently, so the quality, version management, packaging, etc,

become very critical. This requires different skill sets and hence, the reason

for specialized OPD service providers.

Product based solutions are service offerings based on successful products.

In most cases successful products create an ecosystem of their own and thus

provide many opportunities for players to provide value added solutions. For

example, Calsoft provides porting and customization of Adobe Flash for device

manufacturers. Here, through the partnership with Adobe, Calsoft has access to

the Flash source code which enables Calsoft engineers to provide a unique

service offering.

Shrikanth G



shrikanthg@cybermedia.co.in

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