Software industry

SOFTWARE INDUSTRY
PRESENTATION BY: ANJALI SINGH
ANKIT KACHAWA
ANJALI KAUSHAL

INTRODUCTION
• SOFTWARE INDUSTRY IS THE MOST FASTEST GROWING INDUSTRY ACROSS
GLOBE.
• THE SOFTWARE INDUSTRY INCLUDES BUSINESSES FOR DEVELOPMENT,
MAINTENANCE AND PUBLICATION OF SOFTWARE
• THE INDUSTRY ALSO INCLUDES SOFTWARE SERVICES, SUCH AS
TRAINING,
DOCUMENTATION
CONSULTING

INTRODUCTION-HISTORY
• THE WORD "SOFTWARE" WAS COINED AS A PRANK AS EARLY AS 1953, BUT DID
NOT APPEAR IN PRINT UNTIL THE 1960S
• BEFORE THIS TIME, COMPUTERS WERE PROGRAMMED EITHER BY CUSTOMERS,
OR THE FEW COMMERCIAL COMPUTER VENDORS OF THE TIME, SUCH AS
UNIVAC AND IBM.
• THE FIRST COMPANY FOUNDED TO PROVIDE SOFTWARE PRODUCTS AND
SERVICES WAS COMPUTER USAGE COMPANY IN 1955
• THE SOFTWARE INDUSTRY EXPANDED IN THE EARLY 1960S , UNIVERSITIES,
GOVERNMENT, AND BUSINESS CUSTOMERS CREATED A DEMAND FOR
SOFTWARE.

• INFLUENTIAL OR TYPICAL SOFTWARE COMPANIES BEGUN IN THE EARLY 1960S
INCLUDED
ADVANCED COMPUTER TECHNIQUES,
AUTOMATIC DATA PROCESSING,
APPLIED DATA RESEARCH,
INFORMATICS GENERAL.
• DOS, MICROSOFT'S FIRST OPERATING SYSTEM PRODUCT, WAS THE
DOMINANT OPERATING SYSTEM AT THE TIME
INTRODUCTION-HISTORY

INTRODUCTION-SIZE OF INDUSTRY
• ACCORDING TO INDUSTRY ANALYST GARTNER, THE SIZE OF THE WORLDWIDE
SOFTWARE INDUSTRY IN 2013 WAS US$407.3 BILLION, AN INCREASE OF 4.8%
OVER 2012.
• THE LARGEST FOUR SOFTWARE VENDORS WERE
MICROSOFT
ORACLE CORPORATION
IBM
SAP RESPECTIVELY
• MERGERS AND ACQUISITIONS
• DEALS

INTRODUCTION-BUSINESS MODELS
• SOFTWARE-AS-A-SERVICE, OR SAAS
SAAS REDUCES THE CONCERNS ABOUT UNAUTHORIZED COPYING
• NETWORK EFFECTS IN SOFTWARE ECOSYSTEMS
NETWORKS OF COMPANIES, AND THEIR CUSTOMERS ARE AN IMPORTANT ELEMENT
IN THE STRATEGY OF SOFTWARE COMPANIES.

SOFTWARE INDUSTRY IN INDIA
• INFORMATION TECHNOLOGY IN INDIA IS AN INDUSTRY CONSISTING OF TWO
MAJOR COMPONENTS:
 IT SERVICES
BUSINESS PROCESS OUTSOURCING (BPO).
• THE SECTOR HAS INCREASED ITS CONTRIBUTION TO INDIA'S GDP FROM 1.2% IN
1998 TO 7.5% IN 2012

• ACCORDING TO NASSCOM, THE SECTOR AGGREGATED REVENUES OF US$100
BILLION IN 2012, WHERE EXPORT REVENUE STOOD AT US$69.1 BILLION AND
DOMESTIC AT US$31.7 BILLION, GROWING BY OVER 9%.
• THE IT SECTOR IN INDIA IS GENERATING 2.5 MILLION DIRECT EMPLOYMENT
• IT IS ALSO THE WORLD'S LARGEST SOURCING DESTINATION, ACCOUNTING FOR
APPROXIMATELY 52 PER CENT OF THE US$ 124-130 BILLION MARKET.

•MARKET SIZE
THE INDIAN IT-BPM INDUSTRY IS EXPECTED TO ADD REVENUES OF US$ 13-14 BILLION
TO THE EXISTING REVENUES BY FY15, ACCORDING TO NATIONAL ASSOCIATION OF
SOFTWARE AND SERVICES COMPANIES (NASSCOM).
THE INDUSTRY GREW AT A COMPOUND ANNUAL GROWTH RATE (CAGR) OF 13.1
PER CENT DURING FY08-13.
TOTAL EXPORTS FROM THE IT-BPM SECTOR (EXCLUDING HARDWARE) WERE
ESTIMATED AT US$ 76 BILLION DURING FY13.

•MARKET SIZE
 EXPORT OF IT SERVICES HAS BEEN THE MAJOR CONTRIBUTOR, ACCOUNTING FOR 57.9
PER CENT OF TOTAL IT EXPORTS (EXCLUDING HARDWARE) IN FY13.
 BPM ACCOUNTED FOR 23.5 PER CENT OF TOTAL IT EXPORTS DURING THE SAME FISCAL.
 THE DATA CENTRE INFRASTRUCTURE MARKET OF INDIA IS ESTIMATED TO REACH US$ 2.03
BILLION IN 2015, A 5.4 PER CENT INCREASE FROM US$ 1.92 BILLION IN 2014.

•SHARE IN GDP
INDIA’S GROSS DOMESTIC PRODUCTION (GDP) AT CURRENT PRICES IS ESTIMATED
TO BE RS. 11355073 CRORE (US$ 1879.66 BILLION).
COMPUTER SOFTWARE / SERVICES PRODUCTION ESTIMATED AT US$ 103 BILLION
ACCOUNTS FOR A SHARE OF 5.48 PERCENT IN INDIA’S GDP AT CURRENT PRICES
DURING THE YEAR 2013-14.

•INVESTMENTS
ACCORDING TO DATA RELEASED BY THE DEPARTMENT OF INDUSTRIAL POLICY AND
PROMOTION (DIPP), THE COMPUTER SOFTWARE AND HARDWARE SECTOR
ATTRACTED FOREIGN DIRECT INVESTMENT (FDI) WORTH US$ 13,238.58 MILLION
BETWEEN APRIL 2000 AND SEPTEMBER 2014.
INFOSYS PLANS TO INVEST RS 1,400 CRORE (US$ 228.04 MILLION) IN A CAMPUS
PROPOSED TO BE BUILT IN NOIDA, UTTAR PRADESH.

•INVESTMENTS
THE PROJECT IS ESTIMATED TO GENERATE 35,000 DIRECT AND INDIRECT JOBS.
GENPACT LTD HAS SIGNED AN AGREEMENT WITH THE US-BASED AUTOMATION
ANYWHERE TO PROVIDE AUTOMATED BUSINESS PROCESSES FOR ITS CLIENTS.
VISA PLANS TO SET UP A TECHNOLOGY CENTRE IN INDIA IN 2014 AND JOIN A HOST
OF GLOBAL SYSTEM PLAYERS WHO HAVE ESTABLISHED TECHNOLOGY CENTRES IN
THE COUNTRY TO ACCESS ITS SOFTWARE AND ENGINEERING TALENT.

•GOVERNMENT INITIATIVES
ITS SPENDING ON INFORMATION TECHNOLOGY (IT) WILL REACH US$ 7.2 BILLION IN
2015, A FIVE PER CENT INCREASE OVER 2014, ACCORDING TO A REPORT BY
GARTNER INC.
THE GOVERNMENT OF INDIA THROUGH THE BOARD OF APPROVAL (BOA) UNDER
THE UNION MINISTRY OF COMMERCE AND INDUSTRY HAS APPROVED WIPRO LTD'S
PLAN OF SETTING UP A SPECIAL ECONOMIC ZONE (SEZ) IN VISAKHAPATNAM.

•GOVERNMENT INITIATIVES
THE GOVERNMENT OF INDIA HAS LAUNCHED THE .BHARAT DOMAIN NAME WHICH
WILL COVER EIGHT LANGUAGES.
 THE DOMAIN WILL HELP TO BRIDGE THE DIGITAL DIVIDE AND ENHANCE THE REACH
OF THE INTERNET TO REMOTE VILLAGES.
THE CENTRAL GOVERNMENT AND THE RESPECTIVE STATE GOVERNMENTS ARE
EXPECTED TO COLLECTIVELY SPEND US$ 6.4 BILLION ON IT PRODUCTS AND
SERVICES IN 2014, AN INCREASE OF 4.3 PER CENT OVER 2013, ACCORDING TO A
STUDY BY GARTNER

STRENGTH WEAKNESS
OPPORTUNITIES THREATS
SWOT ANALYSIS

•STRENGTHS
HIGHLY SKILLED, ENGLISH-SPEAKING WORKFORCE.
ABUNDANT MANPOWER
CHEAPER WORKFORCE THAN THEIR WESTERN COUNTERPARTS. ACCORDING TO
NASSCOM, THE WAGE DIFFERENCE IS AS HIGH AS 70-80 PERCENT WHEN
COMPARED TO THEIR WESTERN COUNTERPARTS.
LOWER ATTRITION RATES THAN IN THE WEST.
SWOT ANALYSIS

SWOT ANALYSIS
•STRENGTHS
DEDICATED WORKFORCE AIMING AT MAKING A LONG-TERM CAREER IN THE
ROUND-THE-CLOCK ADVANTAGE FOR WESTERN COMPANIES DUE TO THE HUGE TIME
DIFFERENCE
LOWER RESPONSE TIME WITH EFFICIENT AND EFFECTIVE SERVICE.
OPERATIONAL EXCELLENCE
CONDUCIVE BUSINESS ENVIRONMENT

•WEAKNESSES
RECENT MONTHS HAVE SEEN A RISE IN THE LEVEL OF ATTRITION RATES AMONG ITES
WORKERS WHO ARE QUITTING THEIR JOBS TO PURSUE HIGHER STUDIES.
OF LATE WORKERS HAVE SHOWN A TENDENCY NOT TO PURSUE ITES AS A FULL-TIME
CAREER.
THE COST OF TELECOM AND NETWORK INFRASTRUCTURE IS MUCH HIGHER IN INDIA
THAN IN THE US.
SWOT ANALYSIS

•WEAKNESSES
MANPOWER SHORTAGE
LOCAL INFRASTRUCTURE
POLITICAL OPPOSITION FROM DEVELOPED COUNTRIES
SWOT ANALYSIS

•OPPORTUNITIES
TO WORK CLOSELY WITH ASSOCIATIONS LIKE NASSCOM TO PORTRAY INDIA AS THE
MOST FAVOURED ITES DESTINATION IN THE WORLD.
INDIAN ITES COMPANIES SHOULD WORK CLOSELY WITH WESTERN GOVERNMENTS
AND ASSUAGE THEIR CONCERNS AND ISSUES.
INDIA CAN BE BRANDED AS A QUALITY ITES DESTINATION RATHER THAN A LOW-
COST DESTINATION.
$69 BILLION ITES BUSINESS BY 2010
$97.5 BILLION IT (CONSULTING, SOFTWARE SOLUTIONS) MARKET BY 2010
SWOT ANALYSIS

•THREATS
 THE ANTI-OUTSOURCING LEGISLATION IN THE US STATE OF NEW JERSEY. THREE MORE
STATES IN THE UNITED STATES ARE PLANNING LEGISLATION AGAINST OUTSOURCING
CONNECTICUT, MISSOURI AND WISCONSIN.
 WORKERS IN BRITISH TELECOM HAVE PROTESTED AGAINST OUTSOURCING OF WORK TO
INDIAN BPO COMPANIES.
 OTHER ITES DESTINATIONS SUCH AS CHINA, PHILIPPINES AND SOUTH AFRICA COULD
HAVE AN EDGE ON THE COST FACTOR.
 SLOWDOWN OF DEMAND
SWOT ANALYSIS

TYPES OF PRODUCT
SOFTWARE
APPLICATION TOOLS &
EQUIPMENTS
SYSTEM
I.T.
SERVICES
B.P.O. CLOUD
COMPUTING
K.P.O.

•SOFTWARE:-
1. APPLICATION
2. SYSTEM
3. TOOLS & EQUIPMENTS
TYPES OF PRODUCT

•I.T. SERVICES
1. B.P.O.
2. K.P.O.
3.CLOUD COMPUTING
TYPES OF PRODUCT

•EXPORTED
INDIA HAS ALREADY ESTABLISHED HER BRAND EQUITY IN THE GLOBAL IT MARKET.
INDIAN IT SOFTWARE AND SERVICES FIRMS OFFER SOFTWARE
PRODUCT/PACKAGES; A WIDE SPECTRUM OF IT SERVICES INCLUDING SYSTEM
MANAGEMENT AND MAINTENANCE, MOBILE APPLICATIONS, CLOUD COMPUTING
NEXT GENERATION USER INTERFACES, GPU COMPUTING, CONSULTANCY SERVICES,
SYSTEM INTEGRATION, CHIP DESIGN, E-GOVERNANCE, E-COMMERCE, IT ENABLED
SERVICES COVERING BANKING/FINANCIAL/ INSURANCE SECTOR.
TYPES OF PRODUCT

•EXPORTED
 THEIR IT ENABLED SERVICES ALSO INCLUDE CAD/CAM MULTIMEDIA, ANIMATION WORK.
 BPO (BUSINESS PROCESS OUTSOURCING) ASSIGNMENTS, CALL CENTRE RELATED
ASSIGNMENTS, AS WELL AS KNOWLEDGE PROCESS OUTSOURCING (KPO) / LEGAL PROCESS
OUTSOURCING (LPO), MEDICAL LAB, DIAGNOSTIC AND DENTAL SERVICES, MEDICAL
TRANSCRIPTION SERVICES, E-PUBLISHING DATA CONVERSION OR DIGITIZATION, TYPE-
SETTING, COPY EDITING, CONTENT AND DESIGN, GRAPHICS ETC.
TYPES OF PRODUCT

FIVE SOFTWARE
COMPANIES OF INDIA
AND THEIR PRODUCTS

INDIAN SOFTWARE COMPANIES
1. INFOSYS TECHNOLOGIES LTD. –
INDIA’S MOST WELL-KNOWN LARGE SOFTWARE FIRM.
• BANCS 2000 – A BANKING PRODUCT FOR THE DOMESTIC AND INTERNATIONAL
MARKET.
2. RAMCO SYSTEMS –
ONE OF INDIA’S LARGER PRODUCT-FOCUSED SOFTWARE FIRMS.
• MARSHAL (LATER RE-NAMED E-APPLICATIONS) – ENTERPRISE RESOURCE PLANNING
PRODUCT.

3. CONCEPT SOFTWARE –
A SMALL SOFTWARE COMPANY FOCUSSING ON MULTI-LANGUAGE DESKTOP
PUBLISHING PRODUCTS.
• INPAGE – AN ARABIC SCRIPT BASED MULTILANGUAGE DESKTOP PUBLISHING
SOFTWARE PRODUCT.
4. EASTERN SOFTWARE SYSTEMS –
A SMALL SOFTWARE COMPANY FOCUSING ON ENTERPRISE RESOURCE
PLANNING PRODUCTS.
• MAKESS - ENTERPRISE RESOURCE PLANNING PRODUCT TARGETED AT SMALL
COMPANIES.

5. TATA CONSULTANCY SERVICES –
INDIA’S LARGEST SOFTWARE COMPANY. PART OF THE TATA CONGLOMERATE AND
PRIVATELY HELD.
• EX – FINANCIAL ACCOUNTING PRODUCT POSITIONED AS THE WORLD'S FRIENDLIEST
ACCOUNTING SOFTWARE.

REGIONS OF SOFTWARE
INDUSTRY IN INDIA• BANGALORE
• CHENNAI
• HYDERABAD
• DELHI
• MUMBAI
• PUNE
• COIMBATORE
• BHUBANESWAR
• THIRUVANANTHAPURAM
• KOCHI

OWN POINT OF VIEW
• INDIA CONTINUES TO BE THE TOPMOST OFFSHORING DESTINATION FOR IT COMPANIES
FOLLOWED BY CHINA AND MALAYSIA IN SECOND AND THIRD POSITION, RESPECTIVELY.
• LEADING IT SERVICES FIRMS ARE EXPANDING THEIR TRADITIONAL OFFERINGS (IN INDIA)
TO INCLUDE RESEARCH AND DEVELOPMENT (R&D), PRODUCT DEVELOPMENT, AND
OTHER NICHE SERVICES
• INDIA HAS THE POTENTIAL TO BUILD A US$ 100 BILLION SOFTWARE PRODUCT INDUSTRY
BY 2025, ACCORDING TO INDIAN SOFTWARE PRODUCT INDUSTRY ROUNDTABLE (ISPIRT).
• THE SOFTWARE PRODUCTS MARKET IN INDIA, WHICH INCLUDES ACCOUNTING
SOFTWARE AND CLOUD COMPUTING-BASED TELEPHONY SERVICES, IS EXPECTED TO
GROW AT 14 PER CENT IN 2014.

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