BANGALORE, INDIA: Remote infrastructure management services took India by rage and today the country is one of the hottest offshore destinations for RIM services. However, back home it is yet to make a mark in the onshore space.

This doesn't mean that there are no onshore RIMS happening in India. However, on the whole, “Only about five per cent of the Indian companies use onshore RIM,” says Sridhar Iyengar, vice president, Global Solutions, Zoho Corporation.

This might be because of a larger reason that Indian companies are yet to see the kind of growth in terms of IT assets that their Western counterparts had seen.

“Outsourcing managed services came into picture when companies realized that they were spending money on their IT team, which was not the core area of competency and business. Once the recognition sets in that you need to move away from something that is not your core competence, you can go for managed outsource model. This realization is not that strong in India as of now," Iyengar adds.

Moreover, the factors, such as cheap labour, IT talent and expertise, that acted in the favour of India to become the most desired offshore destination for RIM, also acts in favour of Indian companies for not going for onshore RIM.

"Onshore RIM is still very less in India because the savings arising out of labour arbitrage (which is a strong factor for US and Europe) does not apply to Indian customers," V M Kumar, chief marketing officer, Microland says.

So how big a role does labour arbitrage play in outsource RIM model.

“Labour costs in India are almost a sixth of those in New York and London. Despite concerns about wage inflation and a weakening US dollar, the wage differential is sustainable over a long period. Even if wages in India rise at 10 per cent per annum for the next 10 years, wage rates in Mumbai (India’s highest cost city) will be less than a third of those in New York,”  says Hans Rooijmans, head, Infrastructure Management, Logica.

However, going forward, one can't negate the fact that Indian companies, which are growing very fast, also take up RIMS.

“Factors such as access to talent, managing huge variety/complexity in terms of platforms, cost savings through shared service delivery models etc. are compelling enough for many Indian companies to start looking at this model,” Kumar adds.

However, according to Iyengar, Indian companies don't see a pressing economic need to outsource managed services since they are able to find low-cost expertise. Outsourcing will happen over time as cost of maintenance of software and network increases.

Infrastructure management is not a new concept. It has been there for quite sometime. Today it has evolved and grown from local IT teams to outsourced team because of the economy involved.

“This trend has been there worldwide and right now we see a lot of this happening in India. Lots of companies in the Indian scenario, who have software services, see onshore as the next wave of outsourcing. If RIMS providers can do it at a good or better SLAs and at an affordable cost, even onshore RIM services will come in soon,” notes Iyengar.