China vs India debate rages on

Posted on January 28, 2005 
Filed Under Uncategorized

I filed an opinion by Oracle’s Derek Williams on China + India versus Malaysia.

Increasingly the two giants are being compared with each other. This McKinsey article (in PDF) suggests China has long way to go in IT services.

The authors are of the opinion that fragmentation is the problem.

“To compete effectively in global outsourcing, China’s software industry must consolidate. The top ten IT-services companies have only about a 20 percent share of the market, compared with the 45 percent commanded by India’s top ten.

Furthermore, China has about 8,000 software-services providers, and almost three-quarters of them have fewer than 50 employees. No company has emerged from this crowded pack; indeed, only 5 have more than 2,000 employees.

India, on the other hand, has fewer than 3,000 software-services companies. Of these, at least 15 have more than 2,000 workers, and some — including Infosys Technologies, Tata Consultancy Services, and Wipro Technologies — have garnered international recognition and a global clientele. Without adequate scale,Chinese players are unlikely to attract top international clients.”

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