CIOL:IBM to set up development centres in India China

IBM to set up development centres in India, China

The new centres, in Beijing and Pune, will each employ 500 people

Tuesday, October 31, 2006

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MUMBAI - IBM, the world's largest computer services company, said on Tuesday it would set up two new IT solutions centres in India and China, underscoring the Asian countries' growing importance as a hub for outsourcing.

The new centres, in Beijing and Pune, will each employ 500 people, Jeby Cherian, director of IBM's global business solutions centre, told Reuters in a phone interview from Bangalore.

Earlier in October, IBM relocated its global procurement headquarters to Shenzhen in southern China. The company has also made India a global delivery hub for software needs and client services.

"The centres position us strongly to take advantage of what we see as a $160 billion market in service oriented architecture. The other underlying story is it demonstrates IBM's commitment to the emerging markets of China and India," Cherian said.

IBM is focusing on services-oriented architecture (SOA), which makes it easier for businesses to quickly find information stored in different formats.

The company sees SOA as a key driver of future growth, and hopes the technology will help sell other products, such as server computers and consulting services.

The new centre at Pune will focus on developing solutions for the insurance and healthcare industries, while the Beijing facility will tap the growing technology services demand from banks and government departments.

International Business Machines Corp. of Armonk, New York, employs 43,000 staff in India -- up from 9,000 three years ago -- and 7,200 professionals in China, IBM's eighth-largest market.

IBM, which derives about half its revenue from IT consulting and outsourcing, announced in June plans to invest nearly $6 billion in India over three years.

"As we launch these solution centres, we believe there exists a pool of very capable resources to rapidly accelerate what we are trying to do," Ray Harishankar, IBM's global SOA strategic asset development leader, said.

IBM, which started operations in India in 1992, has operations in 14 Indian cities and its network of 2,500 business partners covers 40 cities.

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