iGate in mega outsourcing deal

US-based iGate and a British private equity firm revealed a $1.2 billion deal to buy one of India's oldest software firms in a major move into the outsourcing business, says Business Inquirer.

The consortium of Pittsburg-based iGate and private equity firm Apax Partners is to acquire a controlling 63% stake in privately owned Patni Computer Systems, which has 2 000 global clients and 16 000 employees.

"The combination will help customers get better service, access to more service lines and deeper pools of expertise," Phaneesh Murthy, chief executive of iGate, said in a statement.

Cloud computing and business process outsourcing (BPO) will become increasingly popular with government IT departments during 2011 as funding cuts start to bite, according to analyst firm Ovum, notes V3.

In a report entitled '2011 Trends to Watch: Government Technology', analyst Jessica Hawkins predicts that consumption-based technologies that are delivered through the cloud will grow in use due to the cost-savings they can offer.

"Because cloud delivery means a lot of infrastructure is owned and operated by vendors and because payment is based on what you use, rather than just a flat-rate payment, it gives government departments the chance to make significant savings," Hawkins says.

Over three-quarters of chief financial officers (CFOs) are unsure about outsourcing all of their data to the cloud, while 87% would be prepared to externally host their Web site, states SC Magazine.

A survey of 100 CFOs in medium-sized UK organisations found that concerns around data protection and resilience are the most common factors in holding CFOs back from using third party cloud providers.

While almost three-quarters of CFOs say they would like to remove data centres from their organisation's balance sheet, only a quarter of the respondents think this is likely over the next five years.