It's looking so far as if Indian outsourcing companies have dodged the bullet with respect to the potential catastrophe hinted at by the severing of two vital undersea data cables carrying traffic from the sub-continent last week. No significant ripples have affected their operations in their largest markets, and re-routing appears to have happened rapidly and smoothly.

The real significance of the outage was not the immediate slowdown, but rather whether or not it would give pause to corporations considering engaging India-based outsourcing companies. Fortunately, reactions have been almost uniformly positive. With the excellent demonstration of the effectiveness of their contingency plans, major players such as Tata, Wipro, and Infosys turned the event into a non-event, and quite possibly saved their entire industry.

Still, it's worth noting that the severed cables primarily affected traffic from the Middle East, and that India was only really partially affected, and even then primarily with connections to Europe. While Indian firms have been making significant inroads in the European outsourcing market of late, it still represents quite a small fraction of their business.

In other words, the significance of this incident toward the true resilience of Indian lines of communications is debatable. Had the cables been major trans-Pacific carriers, US-based clients would have been considerably more effected, and alternate routing considerably less abundant. The sense of security that clients come away from this with may be misplaced; on the other hand, if it wasn't at the forefront of their planning processes before, the development of rock-solid contingencies for more significant outages almost surely is now front and center for Indian outsourcers.