Traditional cost-based thinking in software outsourcing is obsolete and almost dead, state numerous analysts and IT business leaders. Current market conditions and customers' demands shift to more innovation and greater value from outsourcing vendors and move value-rich providers up in the rank while leaving India way behind.
Moreover, salaries in India and the region have increased about 15 percent this year, according to the latest October statistics featured in Forbes. And although low-cost IT services have made the Golden Age of India in the past, nearshore Eastern European providers such as Russia, Ukraine, and Poland are snapping at the heels and threaten to eliminate India's cost advantage soon.
Poland, for example, has been attracting much interest lately due to rapid growth rates and favorable market conditions and investment climate in the country. Poland, the sixth-largest EU economy and a new growth engine in the region, witnessed a sharp recovery in GDP (gross domestic product) growth rate of 3.8% in 2010, up to 1.6% on 2009, and quarterly GDP growth has averaged nearly 4.4% since mid-2010, the fastest among European countries. On top of the economic and political stability, nearshore providers offer geographical and cultural proximity, high local education levels, and growing labor pool in many cases. All this creates business attractiveness and sweet conditions for the outsourcing market.
In the tech sector, Poland is particularly strong in Cloud Computing services, which are currently in high demand in the segment of software outsourcing. Poland was valued at just over $35 million in 2010 in the cloud computing market segment, which is up to 7 percent of the country’s IT outsourcing market, according to a report prepared by the research firm IDC. Moreover, IDC forecasts that the sector is expected to grow at an average annual rate of 33 percent between now and 2015, making it the fastest growing sector of the Polish IT market.
The overall IT services market in Poland is expected to grow at a rate of 5 percent annually until 2015.
Sources: San Francisco Chronicle and The Wall Street Journal
Moreover, salaries in India and the region have increased about 15 percent this year, according to the latest October statistics featured in Forbes. And although low-cost IT services have made the Golden Age of India in the past, nearshore Eastern European providers such as Russia, Ukraine, and Poland are snapping at the heels and threaten to eliminate India's cost advantage soon.
Poland, for example, has been attracting much interest lately due to rapid growth rates and favorable market conditions and investment climate in the country. Poland, the sixth-largest EU economy and a new growth engine in the region, witnessed a sharp recovery in GDP (gross domestic product) growth rate of 3.8% in 2010, up to 1.6% on 2009, and quarterly GDP growth has averaged nearly 4.4% since mid-2010, the fastest among European countries. On top of the economic and political stability, nearshore providers offer geographical and cultural proximity, high local education levels, and growing labor pool in many cases. All this creates business attractiveness and sweet conditions for the outsourcing market.
In the tech sector, Poland is particularly strong in Cloud Computing services, which are currently in high demand in the segment of software outsourcing. Poland was valued at just over $35 million in 2010 in the cloud computing market segment, which is up to 7 percent of the country’s IT outsourcing market, according to a report prepared by the research firm IDC. Moreover, IDC forecasts that the sector is expected to grow at an average annual rate of 33 percent between now and 2015, making it the fastest growing sector of the Polish IT market.
The overall IT services market in Poland is expected to grow at a rate of 5 percent annually until 2015.
Sources: San Francisco Chronicle and The Wall Street Journal
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