For India’s export-focused software services sector, 2016 was a tough battle. The information technology (IT) sector had to reduce growth numbers for only the second time in a decade, the first being after a US recession triggered by the Lehman Brothers collapse. This time, they faced challenges due to automation and shifting investments in digital, the UK’s exit from the European Union and an unexpected victory for Donald Trump in the US presidential election.
Globally, Microsoft bought LinkedIn to engage with its corporate customers to deliver better insights. IT services companies such as IBM, Infosys, Wipro, focused on cloud and digital technology, and looked at consolidation of services, says Sanchit Vir Gogia, Chief Analyst and CEO of Greyhound Research. “Software services firms have seen a mid-market consolidation and they realised the need for cutting a lot of fat from their system,” he added.
Large IT services enterprises, both Indian and global, have seen emergence of new peers in start-ups having expertise in digital technology and cloud. While 2016 has seen this trend with companies like IBM and Amazon Web Service vying for the same contract, adds Gogia, the sector would see more such stories going forward. So, a bigger battle in 2017.