MUMBAI:
European banking major ABN Amro is in the finals stages of selecting its IT vendors for a multi-year, multi-billion-dollar contract. For the first time, Indian vendors have emerged as front-runners for a large portion of the contract.

The domestic vendors being considered for various components of the deal are Infosys, TCS and Patni. The local operations of IBM and Accenture could play a major role if these companies are selected.

The mega deal is said to be one of the largest in Europe as European banks, unlike their American counterparts, are not used to outsourcing. The deal also has a large offshore outsourcing component of more than $500m spread over five years.

The final negotiations are being carried out and the share of individual vendors is expected to be announced in a couple of weeks, according to a spokesman for the bank in Amsterdam.

The bank had invited bids for three areas within its IT department almost a year ago. The final vendors for each of these three areas — IT infrastructure, application support & enhancement and application development outsourcing — have been finalized.

IT infrastructure will involve the basic network, servers and other hardware within the company. ABN has finalized IBM and HP for this portion of the deal. In software application support & enhancement, ABN has identified Indian vendors, TCS and Infosys.

In application development outsourcing, which will have an offshore component, more than five vendors have been finalized, namely Patni Computers, TCS, Infosys, IBM and Accenture.

The domestic software services industry is seeing this as a major stage since Indian vendors, for the first time, are competing evenly in a large outsourcing deal. The overall deal involves a fairly important and large onsite presence and Indian vendors have emerged as front-runners.

Moreover, short listing IBM and Accenture for application development outsourcing in a category dominated by Indian vendors is seen as a sign of the times. The development centers of IBM and Accenture in India are seen as much bigger competition than their capabilities in Europe or the US.

Accenture’s operations in India have been ramped up, with aggressive recruitment and hiring. Its local operations already employ more than 11,000 people after less than four years of operations. IBM acquired more than 6,000 people through its acquisition of Daksh last year.

The capabilities that these two companies have acquired or built are now being used to pitch for the outsourcing deals.