Outsourcing research firm TPI says that the Total global outsourcing revenues have declined for the third quarter of '06. Global majors seem to be going for shorter duration of outsourcing contracts which is reducing the total value of the contract per se. Moreover, the total number of contracts in the IT outsourcing area is also shrinking while it is growing in the BPO area.

According to Nasscom, the Indian ITES-BPO segment continued to chart strong year-on-year growth at 37% for FY06. The IT body has also said Indian ITES-BPO exports have grown to $6.3bn in FY06, recording a growth of 37%.

Economic times has an article higlighting this , below are some key highlights from the same:

Europe = Americas in the BPO space: "The BPO market did experience growth globally in the third-quarter. We saw Europe closing the gap with the Americas, with nearly a 46% share of the BPO TCV signed so far this year, compared with almost 49 percent for the Americas," said Siddharth Pai.

Large size deals decreasing

Indian software services firms, on the other hand, bid for contracts of less than $500m value, which are typically spread over 3-5 years. Which is why the revenue growth of Indian firms is unaffected by the overall slowdown in the global outsourcing market.

Source: 1

Prashanth Rai