Indian Firms Bag 64% of Outsourced 'Embedded Development Projects'

With the economic downturn taking its toll on companies with traditional business models, the IC and system design industry is becoming increasingly dependent on outsourcing. This tightening toward value has carved out a niche opportunity for developers utilizing advance tools to create design environments. In this setting, developers from around the world -the 'cream of the crop'- can come together 24/7 to develop fully optimized designs.

As unemployment among engineers in the U.S. escalates to a an all time high of 8.6 percent for the second quarter, global design is taking on new meaning with more and more engineers taking on "gig" contracts to the highest bidder, reports EETimes.com

The unemployment trend among global engineering talent is shored up by a heightened tendency by firms to outsource design requirements. A study done by TechInsights, "2009 Embedded Market Study", reported that the number of engineers who were involved in an outsourced embedded development project was rising steadily over the last three years - that figure rose from 38 percent in 2007 to 43 percent in 2008 and an estimate for 2009 stands at approximately 48 percent. Of all the projects outsourced in 2009, 64 percent of them were sent to Indian firms - this is a sweeping incline from the 51 percent last year. Similarly, China took in 33 percent of the outsourced projects, up drastically from a mere 13 percent last year. Western Europe, Eastern Europe and Southeast Asia trailed in that order as far as embedded development projects were concerned.

Interestingly enough, several Indian outsource firms have claimed that they are already rebounding from economic turmoil that has roiled worldwide markets. Most experts say that the irony of the scenario is that the spike in business is partially due to attempts by customers to slash costs and regain profitability.

According to a recent news report, Wipro Ltd. Posted a 12 percent increase in profit, the equivalent of $209.8 million, in the fiscal quarter ending in June. Net revenue added 5 percent and Wipro is reportedly the third software exporter from India to post higher than expected profits. Earlier in July, rivals Infosys Technologies Ltd and Tata Consultancy Ltd reported increases of 17 percent and 22 percent respectively for the first quarter.

Nonetheless, Bangalore-India based Wipro said in a statement that it remains cautious regarding the business environment in the near future and it also expects to see some price pressure on its billing rates, the Wall Street Journal reports.