NASSCOM’s Report on Indian Software Product Businesses

The National Association of Software and Services Companies (NASSCOM) has recently released a report NASSCOM Software Product Study: Outlook for Indian Software Product Businesses.

Key highlights of the report:

Indian software product businesses are now approaching an inflection point in their evolution. The next decade will be a period of disruptive growth for this segment, with the annual revenue aggregate of Indian software product businesses forecast to grow from USD 1.4 billion in FY2008 to USD 9.5 to 12 billion by FY2015.

Leading Indian software product firms have strengthened their product portfolio through steady investments in organic growth as well as through overseas acquisitions, and have reached credible business scale

Of the existing 371 software product start-ups since 2001, over two-thirds have been formed in the past three years – of which ~100 companies have started their operations in 2007 alone. As a result, while the top 10 companies still dominate, accounting for 84 per cent of the segment revenues, there are over 200 midsized companies and start-ups that have started generating revenues and are contributing to its growth.

They have recognized our contribution! We (at ThinkingSpace) started  in April-2007 and its been an active 1 and 1/2 years of pursuing our products (Activeciti, Eventazoo), with positive response coming from the domestic and global market. We have also broadened our scope by providing Product Engineering to our clients (ImIn-TV).  NASSCOM-Mckinsey have further identified this area as ‘product-shops’. This comes from a fact sheet related to the report, which can be accessed from their site here.

Opportunity for Indian companies in the product domain

India’s potential to cater to this demand for technology services is demonstrated by the host of global technology majors rushing to establish back-end operations in India. The trend towards offshoring product development services is likely to grow as global ISVs continue to struggle to balance their development priorities and the offshore model proves its effectiveness.

While over 60% of the top global ISVs already leverage India for maintenance services and new product development, the opportunity is further fuelled by entry of focused Indian “product-shops”.

I guess we are ‘product-shops’ then :) Anyways, I am thrilled to read this report. Finally, there has been a detailed study on the Indian software products business. NASSCOM  is taking active steps to identify this business environment in India. I hope this is first of the many steps to come in recognizing the other aspect of Indian Software Companies (other than IT Services and BPO). ThinkingSpace was started with a vision to be a successful Indian Software Product  Company, and this report just fuels our desire to become one.