Along with the development of global software industry, in the past few years, China’s software outsourcing industry has made remarkable progress. Although China started a bit late, it keeps developing with a rapid speed. Currently, it is regarded as a dynamic international software outsourcing center. China’s software outsourcing services becomes higher and higher in the international market. On one hand, Europe, the United States and other countries have begun to consider outsource some projects to China in order to avoid risks and enjoy lower costs. And on the other hand, domestic software outsourcing service providers have extended to the world through cooperating with MNC, and they go out through acquisitions, establishing branch offices and other strategies. The markets of China’s software outsourcing services are continuously developing and growing.
Actually, the industry is affected by marketing. Those information industry countries such as the Untied States have outsourced more and more projects to developing countries, which has undoubtedly provided an opportunity. Comparing with some software giants, although China’s software outsourcing industry is still young and inexperienced, with the growing speed, China will grasp the opportunity to enter global markets and occupy those markets soon.
Japan and the United States are the two most important software outsourcers now. After the first innovation of global software industry, Indian has been the biggest beneficiary with accounting for 80% of the total contracts from the United States. But the situation will be changed in the coming future. In order to find outsourcing bases with controllable costs, American software companies begin to outsource projects to other developing countries. With the vigorous economy, China has become an important outsourcing service provider under the supports of Chinese government in these years. In this good environment, some local policies and supports from software parks have provided many benefits on different areas, and it has played a very important role in the development of China’s software export.
Support from Chinese Government
Chinese government has provided supports to software outsourcing enterprises on export credit, enterprise cooperation, establishing public service platform, personnel training and other fields. The government also helps enterprises to establish overseas marketing system, increase enterprises’ outsourcing ability and enter the markets in Japan, the United States and Europe.
China Beats Down the Monopoly of Indian Outsourcing with Lower Price
With the quick development and progress, China’s software outsourcing industry has gained the concern of India who has monopolized 70% of global outsourcing services and 90% of European and American software outsourcing markets. However, China has almost equal number of talents with India, but the costs are much lower, with the average of 30% - 50% lower than India.
Large Consumer Markets Become the Advantages of Outsourcing Industry
Under the leading of foreign-funded enterprises which are continuously entering into Chinese market, China’s software outsourcing market is increasing rapidly, and the huge domestic demand is the irreplaceable advantage for development. With abundant cheap human resources, China itself is a huge consumer market, which makes China more dominant than other countries. Large demands stimulate the global IT equipment suppliers, and this makes China has its own special characteristics as a transnational outsourcing service base. Six-fold Increase In The Next Five Years
In the next five years, China plans to increase 6 times of its software outsourcing industry than current, and reach a considerable size as India. Outsourcing service development is regarded as an important mode of service trade, and service outsourcing keeps continuously increasing. Especially, software outsourcing has become very popular in IT industry. The software outsourcing industry reached 14 billion US dollars in 2006, with 7 times to the sales in 1999, and it is expected that in 2010, it will reach 70 billion US dollars, which means the average annual growth will increase about 50%. |
