Anyway, re: investing in BPOs, some major companies that invest in other companies around the world have given BPOs a pass. They figure the market is too mature for their investments to have a significant impact on the BPO industry.

That being said… think it is too early to chime the death knell for the industry.

Interesting you mentioned “Scient, Viant, and Razorfish” Cuz these were the very same companies I had in my mind when I started to look for a job in 1998-99 :D I was so upbeat I even bought shares of one of the companies. In retrospect how naive I was.

Pankaj

A few things have happened in India for companies who’ve been offshoring outsourcing for a long time. (Incidentally, ‘offshoring’ and ‘outsourcing’ are two unrelated terms! Ideally, India should feature only in the former) :

1. Companies who have been outsourcing to Indian tech companies for some time have realised that they can raise profit margins if they do it themselves.

2. Those companies over time have learnt that Indian management style is different from the Western ones and have adapted.

3. They have been recruiting management teams in India directly.

As I see it, the Indian tech companies will slowly be getting into a tighter and tighter spot over the next few years as the salaries go higher and their profit margins dwindle.

The only way for growth for them would be to handle the lower end jobs (like BPO) where attrition rates are very high; or to enter at the very high end of consultancy which provide greater value per dollar.

In five years, the current crop of junior & middle management will be able to fill those high end roles; as well as the huge migration of kids from all walks of life into BPO areas will fill the lower end vacancies.