The country’s third largest IT firm, Wipro, will earmark 1% of its annual revenues to develop emerging technologies such as cloud computing and software as a service (SaaS). It is the first tech firm in India to make such a commitment. Planned investments of around Rs 190 crore will take place over a 12-month period. In FY09, the company?s IT services reported revenues of Rs 19,170 crore.
Girish Paranjpe, executive director & joint CEO of Wipro?s IT business, told FE that the proposed investments would begin by the end of this fiscal. ?We are aware that these investments will not reap benefits immediately,? he said, but are expected to accrue only in two to three years.
Cloud computing, widely seen as the future of personal and business computing, involves hosting data and offering services over the Internet. Though most Indian IT companies?especially the top four: Tata Consultancy Services, Infosys Technologies and HCL Technologies?have announced greater focus on these areas, none have so far set out specific investments for their development.
According to analysts, the global economic downturn has helped alter the global outsourcing model. As companies look to streamline IT spends, newer models of delivery like SaaS and pay-as-you-go are increasingly gaining currency. Zinnov Management Consulting director Chandramouli CS said: ?The investments have the twin purpose of reducing dependence on headcount through more non-linear growth models and tapping into newer geographies and client bases by offering more cost-effective solutions,? he said.
Wipro?s earmarked funds will go into both technology and market development for these new focus areas and will divide them equally between technology-led and industry-led solutions. While SaaS and cloud computing top the company?s priority list, green technology and information management will also increasingly become focus areas in technology-led solutions. Others areas include platform-based BPO and cross technologies, along with solutions for Internet banking.
Paranjpe said though the investment would be in phases, some areas of development are already at an advance stage. For instance, Wipro Infotech has already started offering cloud-computing services to a few clients. Now, the company plans to build its own private cloud to demonstrate the technology and iron out glitches in its architecture.