TCS, Wipro bid for C&W's outsourcing agreement

Domestic IT majors Tata Consultancy Services and Wipro are believed to be front-runners for a multi-million outsourcing deal from UK-based telecom and networking major Cable & Wireless.

The telephony major is outsourcing around 2,000-2,500 non-core jobs to India, which according to industry estimates would be in the range of $70-100 million (Rs 315-450 crore).

C&W is looking at outsourcing core work, including accounting, financing and billing services to India and had earlier invited bids.

A host of Indian companies had applied for it, but TCS and Wipro are believed to have been shortlisted, sources close to the development told Business Standard in Mumbai n Thursday. Sources also said there were two other Indian companies in the race.

This also could not be confirmed. If awarded, the winner of the contract would have to commence outsourcing work from the last week of December or early January. TCS has also roped in its sister concern Videsh Sanchar Nigam Ltd as partners for the project and the Tata group company will provide bandwidth requirements of the project.

When contacted, a TCS spokesperson said, "TCS is in discussions with C&W on a range of business issues, just as we are with a large number of global corporations.

The talks with C&W are at a preliminary stage and it would be premature to make any further comment on this issue." A Wipro spokesperson declined to comment, stating the company as a policy does not comment on customer deals.

The current industry outsourcing rate ranges between $20-30 per hour for an 8-hour shift. Indian outsourcing companies have normally three shifts, while some have even four.

Analysts, after a back-of-the-envelope calculation, estimate that contracts range somewhere between $75-100. This is not the biggest single outsourcing contract to India, as TCS and Infosys each had earlier bagged a $400 million deal from ABN Amro.

It was part of a $2.2 billion contract, of which TCS got around $260 million, while Infosys got around $140 million and the rest went to global major IBM.