Outsourcing trends

CNET recently did a piece on trends in outsourcing.

Consolidation: The space here is not very clearly defined. While on the one hand most of the large players themselves have set shop in outsourcing destinations, the markets for some services has not yet taken off (Financial services, Legal Services, Medical R&D processes, High end engineering modeling etc). I believe that the major outsourcing players will raise capital and expand before the first trends of consolidation clearly emerge.

Globalization: Whatever IDC may say India will not lose its edge for the 'English' dominated markets. We already cant cover the Asian markets which could as well turn out to be huge opportunities. Indian companies will open international centers. Companies like Genpact already seek to leverage their experiences in other low cost centers.

Person-to-person offshoring: Now this is interesting, but how big will this market be? Tutoring-definitely, its already a success story. But with issues such as data security creeping in this could likely be only a small piece of the entire pie. Probably the proverbial long tail market here.

Green sourcing: Still the parameters of 'Green' are clearly defined very few companies will have the incentive to look at green sourcing. I believe its unlikely to happen in the next 3-4 years unless the new Kyoto negotiations impose strict penalties on companies based on the green footprint.

Virtual worlds: Very very likely. The market could emerge as a subset of the entire p2p offshoring premise. A part of a world could be created or maintained by anyone with access to the account. How big and how soon? Large scale connectivity would be the key issue.