Mumbai, India, 06 March 2009

ValueNotes conducted an executive briefing session, at Regus Business Center, Friday, March 6th, 2009 to present findings of their recently released report ‘Market Research Outsourcing – Buyer Survey’. The session was attended by senior executives from Ugam Solutions, Dexterity, Exevo, Annik Technology, Cross-Tab, TCS BPO, WNSGS, Integreon, IDC, and Datamatics, among others.

The event started off with a presentation by ValueNotes on the key findings and future outlook of the MRO industry. It was followed by panel discussions on the future of market research offshoring business and funding opportunities in MRO services.

While cost arbitrage has been a primary driver for offshoring, the survey brings to light that research agencies rate other factors like faster turnaround time, better quality of work as equally important. Interestingly, quality of work and client confidentiality issues emerged as key concerns towards offshoring.

While offshoring drivers and concerns remain similar across key markets like US and Europe, these markets differ significantly in their choice of offshoring destinations.

The MRO service provider landscape ranges from the captives of large research agencies to Pure-play MROs, full service research firms, KPOs and large and medium BPO service providers. The survey shows a clear inclination by research agencies towards using multiple options in offshoring. The larger research agencies have greater inclination to set up captives or employ specialized MRO service providers. Mid sized agencies prefer to work with full service research agencies while smaller firms are most comfortable with service providers of comparable size.

Today, while the MRO services industry is on a rapid growth path with research agencies and corporates offshoring greater volumes and more complex work, the future growth will be largely driven by niche opportunities in adjacent areas, developing capabilities to serve the relatively smaller research agencies and taking up more services higher up the value chain.

The first panel discussed trends in the MRO industry and its future outlook in current economic environment. Panelists included Sunil Mirani, CEO- Ugam Solutions, Pravin Shekhar, CEO- Dexterity, Alok Tayal, CEO- Exevo and V K Raman, CEO- TCS BPO, discussed strategic options to negotiate the economic downturn.

Commenting on the outlook for MRO services in recession , Sunil Mirani, CEO, Ugam Solutions, opined that marketing budgets have taken a hit and there has been retrenchment of work (volumes), however, with some companies offshoring and some preferring not to offshore, net-net the equation will balance out. Alok Tayal, CEO Exevo highlighted an opportunity due to increase in cost pressures.
Panelists agreed that MRO service providers will have to look at additional opportunities and focus on delivering technology driven solutions in near future.

The second panel discussion focused on funding in the knowledge services segment and explored reasons for comparatively lower funding in MRO services segment. Panelists included Rahul Sahgal, President and CEO, Annik Technology, Manish Modi, President, Exevo and Ashwin Mittal, Director, Cross-Tab.

While exploring reasons for lower level of VC funding, especially in MRO services, panelists agreed that high valuations and smaller scale in MRO were factors that weakened its attractiveness for funding. Manish Modi, President Exevo was of the opinion that venture capitalists do not believe that the market for MRO is as large when compared with other BPO segments. He said they typically look at investing much larger amounts (close to a couple of millions dollars), which is huge for MRO service providers. If an investor were to sell his/ her stake it would be an attractive opportunity for a larger MRO company or large BPOs. Rahul Sahgal of Annik opined that BPOs or larger MRO companies themselves will be a logical option to buy a MRO company if an investor looks to sell out its stake. Manish Modi of Exevo, was of the opinion that the ultimate exit to any funding is through an IPO. This was debated by the panel.

On the subject of attracting VC funding, Ashwin Mittal of Cross-Tab emphasized the importance to attract and retain best-of-the-class talent; a measure to demonstrate capabilities. Manish Modi, on the other hand, highlighted the need to identify better opportunities in the near future but something that people are not doing currently.

Get insights into the Publishing Offshoring industry at an Executive Briefing hosted by ValueNotes

Venue: GRT Radisson, Chennai, India

Date: 26 June 2009

Over the last two years, services offshored in the publishing sector have undergone a transition from low value services to high value services such as original design, testing and assessment, and e-learning tools. There has been an influx of technology in the industry that has enhanced productivity, work flow and most importantly, reduced cost and turnaround time. Providers have transcended traditional vendor roles to develop partnerships with publishers to drive innovation, leverage cost and ideation. The culmination of these transitions will help the industry to grow to $1.2 b by 2012.

We have established that there are over 140 vendors in the publishing offshoring industry and we have identified a minimum of 35 credible service providers, which fall within the scope of the study. These service providers have been categorized into five clusters and analyzed based on their services, focus, positioning and strategies.

Why should you attend this briefing?

This executive briefing will provide you with an in-depth analysis of the Indian publishing vendor landscape and the opportunities in the global publishing market. Based on our extensive primary research with key executives at various outsourcing companies and publishing industry experts, ValueNotes will present to you the key insights and findings of the report “Offshoring in the Publishing Vertical – 2009”.

About ValueNotes

ValueNotes Database is a leading provider of business intelligence and research, with expertise across select domains and types of customer needs. Working with clients across the globe, we have significant understanding of international markets.

The ValueNotes Outsourcing Practice is one of the largest information providers on the outsourcing industry. The Practice uses a comprehensive, analytical framework providing fresh insights into the fast emerging and yet, complex outsourcing space. We extensively track the space through regular analysis of news and events, continuous primary research and contact with the industry. Additional information is available at www.SourcingNotes.com

Pune, India, 26 August 2009

The magazine segment represents a major chunk of the global print publishing market. With more than 100,000 magazine titles being published in the US and UK alone, the magazine publishing industry is huge in scale and operations. Each year, the US and UK markets sell upwards of 4 billion magazine copies. However, the industry is not without its share of problems. It faces a challenging operating environment, with changing consumption patterns and rising costs, intensified by recessionary influences.

The magazine market, like the newspaper market, is driven by a consumption cycle that is primarily determined by consumer and corporate spending. Consumer spending refers to subscriptions and reader base, and corporate spending refers to advertising. Data compiled by the American Publishers Information Bureau in April 2009 reports a 20.2% decline in ad spending compared to the previous year – the worst hit have been magazines in the automobile, finance, insurance and real estate categories. The rise of Web advertising has also added to publisher woes. Magazine publishers are now being forced to re-define their business models to address consumers’ changing preferences, rising costs, decreasing revenues and shrinking markets.

The ValueNotes report, titled “Magazines: the new frontier for outsourcing“, analyses and evaluates the challenges faced by magazine publishers and how they may overcome them.

About ValueNotes

ValueNotes is a leading provider of business intelligence and research, with expertise across select domains and types of customer needs. Working with clients across the globe, we have significant understanding of international markets.

The ValueNotes Outsourcing Practice is one of the largest information providers on the outsourcing industry. The Practice uses a comprehensive, analytical framework providing fresh insights into the fast emerging and yet, complex outsourcing space. We extensively track the space through regular analysis of news and events, continuous primary research and contact with the industry. Additional information is available at www.SourcingNotes.com

The recent buyer survey of market research agencies from various international markets released by ValueNotes finds close to two-thirds of the research agencies are already offshoring to companies in India, Eastern Europe and Latin America. While the large multi-national research agencies have always been outsourcing, the smaller firms with revenues typically less than USD 10m are fast adopting offshoring. The survey reveals that with greater competition, research agencies, especially the smaller ones are increasingly using offshoring to gain competitive advantage.

The MRO buyer survey is a continuation of the research published by the ValueNotes Outsourcing Practice in January 2008 on the Indian MRO vendor landscape. The report estimates that MRO revenues are slated to grow from $148 million for FY07 to reach $800 million by FY12 at CAGR of 47%. Corroborating the earlier research, this “Buyer” survey reveals that, currently, offshoring is largely limited to activities lower down the value chain like data collection, data processing and panel services. According to Monali Singhvi, Analyst, ValueNotes “While there is greater adoption of offshoring by market research agencies, overall penetration is very low with a majority of the agencies offshoring less than 10% of their total work.”

While cost arbitrage has been a primary driver for offshoring, the survey brings to light that research agencies rate other factors like faster turnaround time, better quality of work etc. as equally important. Quality of work and client confidentiality issues have emerged as key concerns towards offshoring. While the offshoring drivers and concerns remain similar across key markets like US and Europe, these markets differ significantly in the choice of offshoring destination. “A majority of research agencies offshoring to India are primarily form the US, while those offshoring to Eastern Europe are from EU”, says Pranav Dixit, Analyst at ValueNotes Outsourcing Practice.

The MRO vendor landscape ranges from the captives of large research agencies to Pure-play MRO vendors, full service research firms, KPOs and large and medium BPO service providers. The survey shows a clear inclination by research agencies towards using multiple options in offshoring. The larger research agencies have greater inclination to set up captives or employ specialized MRO service providers. Mid sized agencies prefer to work with Full service research agencies while smaller firms are most comfortable with service providers of comparable size.

According to Arun Jethmalani, CEO, ValueNotes, “With a majority of research agencies planning an increase in offshoring volumes, significant growth opportunities exist in both high volume low value activities as well as select high value services like report writing data analysis and analytics.”

The ValueNotes report: “Market Research Outsourcing: Buyer Survey” provides by in-depth in-sights and analysis of the offshoring awareness, and concerns and challenges faced by market research agencies in various markets. The survey brings out the current perceptions towards risks and rewards of offshoring in the market research industry.

Consolidation in the insurance BPO services provider landscape is expected in more than one direction. The larger BPO vendors are aggressively buying out smaller, niche providers to gain scale, clients and expertise in the insurance domain. Larger providers are also entering innovative arrangements with insurance carriers to buy out and manage their back-office transaction processing units.

Further, a new stream of consolidation is likely to be a growing reality, although it may appear far-fetched right now. Third party administrators or TPAs who will be increasingly threatened by competitive pressures may buy out smaller BPO vendors, especially offshore ones, to build a presence at a low-cost base like India. On the other hand, some of the large third party providers are likely to buy out TPAs, for on-shore presence, client access and domain knowledge.

A report by Pune-based ValueNotes suggests that insurance offshoring (BPO) to India is likely to grow at 30 percent CAGR over the next three years. India’s revenues are estimated to grow from $690 million currently, to around $2 billion by 2010. Driven by the need to reduce costs, differentiate products in an increasingly competitive environment, and ensure regulatory compliance, offshoring will be a growing imperative for the global insurance industry.

According to the report “Insurance Outsourcing: India Gains Momentum As Offshoring Intensifies – Trends, Insights and Key Vendor Profiles”, the large established offshore BPO vendors in India are expected to gain the most, as they will be able to demonstrate the ability to manage scale, and offer services across the value chain to global customers. “By FY2010”, says Arun Jethmalani, CEO of ValueNotes, “a large number of Indian vendors will have evolved into mature, end-to-end service providers, competing with multinational outsourcing companies”. Players like Genpact, WNS and EXL Services, as well as BPO offshoots of IT companies like IBM, TCS, Infosys (Progeon) and Wipro will emerge as formidable global players in the next few years.

Arpita Bedekar, analyst at ValueNotes, expects “greater offshoring of high-end, higher-value services like analytics, actuaries and underwriting to push average billing rates in offshore insurance BPO upwards by more than 25 percent in the next two to three years”.