"Europe is merely powerfu; India is beautiful." So said controversial writer and activist Savitri Devi.
The country surely remains beautiful, but the economic power so long wielded almost exclusively by the west is beginning to shift, at least a little. No more so is this evident than in the IT services arena. The top Indian providers - including TCS, Infosys, Wipro, Tech Mahindra, HCL Technologies, Cognizant and Patni - have entrenched themselves among the UK's IT services elite. And beneath them many other players are eager to get in on the act.
Anthony Miller, managing partner of analyst TechMarketView, claims the leading pack of Indian players grew 2010 UK revenue 16 per cent to £2.8bn, in a market that declined overall. Similar figures are projected for this year.
In the past 10 years, the Indian firms have grown from nothing to take between five and 10 per cent of the UK software and IT services (SITS) market, he says.
"Most of the UK- and Europe-based players have, at various points, had their margins eroded - but that is not just an offshoring thing, there has been a lot of margin shaving going on," Miller adds. "But the Indians have reset the rule book as to how much you can charge."
One Indian player looking to get aggressive on price this year is Mahindra Satyam. The firm was known as Satyam Computer Services until its acquisition by Tech Mahindra two years ago. Mahindra Satyam senior vice president Roger Newman claims it will take "full advantage" of its combined might.
"We want to continue grabbing business from local players, as well as global multi-national players," he says. "Obviously we will not do silly things, but we are looking to grow our top line rapidly, and would like to be disruptive to win these deals."
Ganesh Pai, senior vice president at HP-owned, Bangalore-based MphasiS, asserts that services providers face an ongoing battle to protect profitability as clients seek more bang for their buck.
"The trend is towards providing higher value at lower cost," he adds. "So offshore providers are on a constant cost refresh cycle to crunch the bottom line to sustain margins."
One market in which the Indian titans have struggled to make a huge dent thus far is the public sector. But the worm appears to be turning, with a handful of high-profile offshoring deals being signed off over the past couple of years.
Earlier this month, news emerged that 100 tech jobs at Birmingham City Council are to be outsourced to India. The jobs are part of the Service Birmingham programme - a joint venture between the council and London-based outsourcer Capita.
Mahindra Satyam's Newman accepts that the public sector has proved "difficult to crack" for his firm. But needs must when the devil drives, and cash-strapped public bodies are exploring new avenues, he adds.
"There are spending cuts that might force people to think differently and some bodies that would not have talked to us in the past are talking to us now," he says.
Bindi Bhullar, EMEA director of HCL Technologies, says: "There is a nice cosy set-up, but if you want to shake things up and make significant leaps and bounds, you have to be open to fresh approaches. Regardless of whether they are based in the UK or overseas, the public sector is opening up to new blood and talking to other service providers."
Margins may be under pressure, and ambitious rivals from all corners of the globe may be pushing hard to win business, but the consensus remains that UK players can continue to compete, one way or another.
HCL's Bhullar states that, while competition may be fierce, there are still opportunities for local services providers.
He says: "Factors such as the language barrier, policy regulation and trade protection can be an issue for a few of the big players."
Pai, from MphasiS, asserts that local players and overseas entrants should look to partner with each other.
"The pure-play European firms are deeply rooted and have a good understanding of the market and end customers; Indian players have the economies of scale as well as end-to-end portfolios of services," he explains.
Andrew De Cleyn, managing director for UK outsourcing at Reading-based Logica, says top players must be seen as global operators, regardless of their background.
"Most clients want to work with a provider that is able to be French in France, English in the UK and Indian in India," he says. "Those outsourcers able to offer the blend of services and locations that meet client needs will be the most successful, independent of whether they are an Indian, UK or US company."
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