The Indian software development industry got another boost after it bagged a contract to develop software for an Australian company that was facing problems with Australian web developers.
The contract is a latest in the growing number of Australian firms that are turning to Indian information technology companies for their software development solutions. It is also a reflection of an international phenomenon as more than200 of Fortune 1,000 companies are outsourcing their software development needs to India.
Rafael Chavan de Montero Ozbook, founder and CEO of Ozbooks, opted for software development in India after reportedly burning his fingers with two reputed Australian software-developing companies. He spent several hundred thousand dollars to get his Web site developed. But both failed to honor the agreement, Montero is quoted as saying in a report in the Sydney Morning Herald.
Australia's book retailer Ozbooks, which retails books only on the internet, set up its own software development facility Hilory Technologies in Chennai as it was facing consistent problems with Web developers in Australia, Montero said.
Indian Web developer and co-founder of Hilory Technologies Sundarganapathi Gopalkrishnan, 25, would be looking after the company affairs in India, said reports in the Sydney Morning Herald. The new firm plans to move to Bangalore, the IT hub of India, in the near future.
Montero got disillusioned with one of the two software developers when it demanded an exorbitant amount of money to add a goods and services tax functionality to the Ozbooks Web site. The amount, according to Montero, was the same as the original cost of the Web site itself. Montero is considering legal action against that firm.
Gopalkrishnan contacted him at this stage looking for work. He was commissioned to add the GST functionality to the Ozbook Web site after "initial skepticism." The Indian software programmer reportedly completed the job in record time for "a fraction of the price" quoted in Australia, leading to the partnership in Hilory Technologies.
Montero spent the same amount, Aus.$300,000, to establish the new company in India as he had forked out to get one single Web site up and running in Australia, according to the report. The Chennai-based company has already started churning out revenue for Ozbooks as the first Web site developed by them, OzHiTech hit the Web a month ago.
Software development is a booming industry in India and, according to India's National Association of Software and Service Companies figures quoted in the report, the Indian IT software and services industry had grown from US$150 million a decade ago to almost US$9.5 billion in the 1999-2000 financial year.