A total outsourcing of IT systems, application development and maintenance and other back-office work will help these telcos become leaner and manage exponential growth in their business more effectively
Middle East phone firms Telecom Egypt, Saudi Telecom Company (STC) and Zain Telecom plan to emulate the outsourcing model created by Indian telco Bharti Airtel and are in the process of fleshing out multi-year outsourcing contracts worth Rs 1500-Rs 2,000 crore each.
A total outsourcing of information technology (IT) systems, application development and maintenance and other back-office work will help these telcos become leaner and manage exponential growth in their business more effectively.
According to a senior executive at one of these telecom companies, internal discussions for total outsourcing of IT and back-office work has already started. He requested anonymity because he is not authorised to speak with media.
"Many of these telcos have been enjoying high average revenue per user (ARPU) of over $30, and with that coming down, they are seeking ways to become more efficient," the executive said. Managing growth and ensuring better focus on core, telecom business are among triggers for outsourcing by these telcos.
IBM, Wipro, Logica and Tech Mahindra are currently exploring these outsourcing contracts, however, these vendors declined to comment on any specific future contract from the region.
Source: The Economic Times
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