India's IT outsourcing sector is strong, and getting stronger. In evidence: One of India's largest outsourcing firms, Wipro, has acquired Austrian chip developer New Logic Technologies. The acquisition will allow Wipro's service arm to offer WLAN and Bluetooth capabilities, thus beefing up its IT offerings on the subcontinent. The all-cash $56 million acquisition will add some 120 specialist engineers to Wipro's work force, strengthening the company's wireless R&D activities. It will also give WLAN providers a new, low-cost supplier of both semiconductors and software (one-third of Wipro's 2005 revenue comes from its R&D services business).
IT outsourcing on the subcontinent is good business. Wipro, Infosys, and TCS have said they show double-digit increases in sales in the last few weeks. At the same time, their U.S. counterparts such as IBM and EDS are happy to see even single-digit increases in sales.