Will IT companies gain from Satyam mess?

BANGALORE: Will multinational technology vendors in India be the biggest gainers from the Satyam scam? Some think that the likes of IBM, Accenture and HP-EDS will be at an advantage over the Indian biggies because of a perception that governance issues are greater in domestic players.

���Several clients have told us that they would prefer working with MNC firms rather than Indian outsourcers. In many cases such decisions are aligned with customers��� internal security policies,������ says Sudin Apte, country head of research firm Forrester India. ���Also, if you are working with an MNC partner and there���s an untoward incident, the person in charge may not be blamed. But if an issue crops up in an Indian company, it may be tough to explain.������





Avinash Vashishtha, MD of offshoring advisory firm Tholons, says that although it is too early to fathom, the Satyam episode has given MNCs a significant edge. ���Now it all depends on how the government and the industry manage to minimise the negative impact.

With the global recession and now the Satyam effect, there will be a sizable decline in outsourcing deals. The annual industry growth will slip from 16% last year to 6/7% this year as alarge number of deals will be heading towards other destinations,������ he says. However, Kapil Dev Singh, country manager of research firm IDC India, says the India story is a two-decade-old one, and cannot be erased easily . ���Also, price will still be a key differenciator for domestic players,������ says Singh.