With Indian enterprises tightening their IT budgets and deferring any new investments, IT vendors have started offering discounts of as much as 40% on software applications and other IT infrastructure products.
"Vendors are offering up to 40% discount on software applications, and up to 25% for IT infrastructure products," Suvanjay Kumar Sharma, vice-president of corporate strategy at Yes Bank told ET. "This is a good opportunity to buy IT products and solutions at a discounted price," he added. Yes Bank spends around Rs 60 crore annually on IT.
During year-ended March 2008, Indian companies spent around Rs 26, 544 crore ($5.6 billion) on buying IT services, according to research firm Frost and Sullivan. Companies selling software for running and integrating business processes, including SAP and Oracle, are also offering discounts to their customers, according to Forrester Research.
"As you may know, discounts depend on the size of a deal, but for deals above $1M in value, we are seeing bigger discounts than before," said Forrester Research vice-president Ray Wang. "We can see discounts that start from 50-70%, especially in this last quarter," Mr Wang added.
However, some customers such as Arun Gupta, who is the group chief technology officer at Shoppers Stop, say the vendor discounts have happened even in the past, when the economy was doing better.
Source: Pankaj Mishra From ET 11/Nov/2008
