Update: Etisalat DB's IT Contract Outsourced to Tech Mahindra

Etisalat DB Telecom has announced that it is outsourcing its IT applications to Tech Mahindra for $400 million. The contract is to be carried over into a 10-year period. In earlier reports, Wipro had been expected to win the coveted contract.

The contract outlines outsourcing of IT application systems from Etisalat to Tech Mahindra throughout 15 telecom zones within India. The major applications will include Business Support System components and Operating Support System domain, reports dancewithshadows.com.

The company reportedly said the partnership with Tech Mahindra would assist in rapid progression of cost and market efficiencies. An official from Etisalat DB said that Tech Mahindra was a good choice since it has the process expertise, required domain, and a track record from an earlier collaboration in Egypt. Mahindra's IT skills combined with its innovative delivery is expected to be an asset to UAE-based Etisalat as it plans to rollout operations in India. Representatives of Etisalat added that Tech Mahindra is capable of delivering the most valued services in the market, along with customer experience.

A press release by CEO of Tech Mahindra, Sanjay Kalra, said the IT outsourcer hoped to expand its relationship between the two firms after a successful stint with Etisalat in Egypt, involving the Greenfield operations. The Indian telecom industry is designated as a high-growth sector and both the firms are expected to reel in profits.

The trend of outsourcing in the telecom sector was initially put forward by IBM and Bharti Airtel. Incidentally, that agreement has now been augmented to more than $2 billion. Following the move by Bharti Airtel, several Indian telecom firms have resorted to outsourcing its IT-related work.