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CeBIT 2008
T-Systems Partners with Cognizant for Global Offshoring
| Mar 5, 2008 | Business Telecom Services - Europe | Show Update
| Analyst: Dustin Kehoe
Current Perspective: Positive
Vendor Importance: High
Market Impact: Moderate |
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Event Summary
March 7, 2008 – T-Systems has announced a partnership with Cognizant to target European MNCs with global requirements for system integration, outsourcing, and offshoring. The two companies will have 110,000 employees, expanded vertical focus and global service delivery. As part of the deal, Cognizant will also pick up T-Systems Indian operations through a share purchase. Financial details are not disclosed.
Analytical Summary
• Current Perspective: Positive on T-Systems’ partnership with Cognizant for global system integration and offshoring capabilities as the company will gain overnight access to 40,000 employees based in India and China and 35 regional delivery and development centres. T-Systems will also be able to expand its vertical expertise into new verticals (e.g., life sciences, health care, finance and manufacturing) across Europe.
• Vendor Importance: High as T-Systems needed to improve its offshore and global service delivery to support its IT operations and system integration businesses. This was also important for improving the company’s application outsourcing, integration and business transformation services on a global basis. T-Systems had to offer strong offshore competence in order to compete in these areas at competitive prices.
• Market Impact: Moderate on the European ICT market as T-Systems will be more competitive (as a result of the Cognizant partnership) for global ICT outsourcing services. Indian competitors, such as TCS, Infosys and Wipro, targeting European MNCs for global offshoring deals will be impacted the most by this announcement. Operators that are offering network-based ICT services will also be forced to reconsider their own offshoring strategy.
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Current Perspective
Competitive Positives and Concerns
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