Posted on 03/27/2004 9:17:05 AM PST by BushisTheMan
NEW DELHI (AFP) - Turning the tables on the outsourcing controversy in the United States, India's largest private telecoms firm, Bharti Televentures, awarded an in-house IT services contract to US computer giant IBM worth up to 750 million dollars.
The move by Bharti, one of the most aggressive Indian telecoms players, to outsource its IT needs to the US firm comes amid a raging controversy in the United States about jobs being shifted to India and other developing nations where labour is cheaper.
"Arrangements like this will take the sting out of outsourcing," said Sunil Bharti Mittal, chairman of Bharti Televentures.
Bharti said Friday that IBM would now take care of all Bharti's hardware and software requirements, consolidate its data centres, information technology (IT) help desks and disaster recovery capabilities.
"The IT piece is critical in the telecoms jigsaw. Bharti will henceforth stop buying IT telecom, it will stop maintaining IT equipment. We are putting that responsibility on IBM," said Mittal.
"All we know is that we will have IT on tap -- and we are sure that if we have to start servicing 25 million customers from our current levels, IBM will be there to support us on the IT side.
"We're outsourcing the management of our desktop IT environment to improve cost efficiency and service flexibility," he added.
Under the 10-year contract, 200 Bharti computer engineers will be transferred to IBM but some of them will still work on the premises of the Indian group.
"This arrangement is possible because they (IBM) are not only an American company but have a strong presence in India with about 9,000 employees which is not a small number," said Mittal. "I feel safe in their hands."
Under the deal, Bharti Televentures will also be the "preferred supplier" of telecommunication services to IBM India.
"Based on the estimates agreed between Bharti and IBM, the total deal for the first five years is estimated to be 250 to 275 million dollars. For a 10-year period, the total deal is likely to be in the 700 to 750-million-dollar range," said Mittal.
The deal marks a reversal of the trend in which US firms outsource work to India which has the largest pool of English-speaking graduates outside the United States that are willing to work for wages that are far less than those paid in the West.
The issue of outsourcing, creating fears of widespread job losses, has generated huge controversy in the United States in a presidential election year.
Colleen Arnold, general manager of IBM said that this was one of the "largest and most exciting deals" that IBM had pulled off in South Asia.
"It is a significant deal -- a lot of telecom firms are now watching our relationship," said Arnold.
She added that IBM would roll out its most advanced technology to give the Indian firm the "flexibility to introduce the latest in voice, data and content-based services to its cutomers.
"Bharti Televentures and IBM will also pursue joint go-to-market opportunities and avenues for selling value-based services in the areas of communications, IT services and convergence," said Arnold.
Bharti has six million mobile subscribers and 544,900 fixed-line customers.
It is one of the strongest players in the Indian telecoms market, an industry which has emerged as a barometer of the opening up of the country's economy.
Reading the article, it was hard to tell. Howeer, it says that 200 Indians will be transferred to IBM to work with IBMers on desktop IT environments. That says to me that this company is hiring IBM to create desktop software. Those software people will be in the United States.
Don't get me wrong, IBM is planning to outsource lots of jobs to India and China, which is why I send letters of complain to IBM's management.
This deal is good for American workers? [Right and Private Lynch was Rambo]
Heck of a deal! In other words, all the jobs will still be held by Indians.
"This arrangement is possible because they (IBM) are not only an American company but have a strong presence in India with about 9,000 employees which is not a small number," said Mittal. "I feel safe in their hands."
Um-hmm. They have 9,000 employees there, get a contract, hire more Indians on that, and U.S. workers get....nothing.
As I said before, heck of a deal! (/bitter sarcasm)
Watch the India Government proclaim that "they are doing their part" to ease trade tensions. They are just laughing at us, right in our faces.
The American voter is not that stupid. The GOP better get their act together on this.
The Indian managers only hire Indians.
Very multicultural, and you can bet management wants it this way. They get their cultural quota list in order muy pronto. At Lockheed where I worked, the HR group was black and disabled persons. If a non disadvantaged person got hired, it was not a case of racism, because of who did the hiring. At my wife's temp job, the Phillipine HR staff only hired their ethnicity.
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