it industry profile

8/16/2019 It Industry Profile

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CHAPTER-1

INTRODUCTION

Industry Profile

INFORMATION TECHNOLOGY

Information technology (IT) is the ali!ation of !o"uters to store# retrie$e# trans"it and

"aniulate data# often in the !onte%t of a &usiness or other enterrise' IT is !onsidered a su&set

of information and !o""uni!ations technology (ICT)'

EVOLUTION OF IT INU!TRY

Infor"ation te!hnoloy has &een around for a lon# lon ti"e' asi!ally as lon as eole ha$e

&een around# infor"ation te!hnoloy has &een around &e!ause there *ere al*ays *ays of

!o""uni!atin throuh te!hnoloy a$aila&le at that oint in ti"e' There are + "ain aes that

di$ide u the history of infor"ation te!hnoloy' Only the latest ae (ele!troni!) and so"e of the

ele!tro"e!hani!al ae really affe!ts us today# &ut it is i"ortant to learn a&out ho* *e ot to the

oint *e are at *ith te!hnoloy today'

Age"

#re mechanical

The re "e!hani!al ae is the earliest ae of infor"ation te!hnoloy' It !an &e defined as the ti"e

&et*een ,'C' and 1+.A'D' /e are tal0in a&out a lon ti"e ao' /hen hu"ans first started



!o""uni!atin they *ould try to use lanuae or si"le i!ture dra*ins 0no*n as etrolyhs

*hi!h *ere usually !ar$ed in ro!0' Early alha&ets *ere de$eloed su!h as the Phoeni!ian

alha&et'

Petrolyh

As alha&ets &e!a"e "ore oular and "ore eole *ere *ritin infor"ation do*n# ens and

aer &ean to &e de$eloed' It started off as ust "ar0s in *et !lay# &ut later aer *as !reated out

of ayrus lant' The "ost oular 0ind of aer "ade *as ro&a&ly &y the Chinese *ho "ade

aer fro" ras'

No* that eole *ere *ritin a lot of infor"ation do*n they needed *ays to 0ee it all in

er"anent storae' This is *here the first &oo0s and li&raries are de$eloed' 2ou3$e ro&a&ly

heard of Eytian s!rolls *hi!h *ere oular *ays of *ritin do*n infor"ation to sa$e' 4o"e

rous of eole *ere a!tually &indin aer toether into a &oo0-li0e for"'

Also durin this eriod *ere the first nu"&erin syste"s' Around 1A'D' *as *hen the first 1-5

syste" *as !reated &y eole fro" India' Ho*e$er# it *asn3t until 67.A'D' (77. years later) that

the nu"&er *as in$ented' And yes no* that nu"&ers *ere !reated# eole *anted stuff to do

*ith the" so they !reated !al!ulators' A !al!ulator *as the $ery first sin of an infor"ation

ro!essor' The oular "odel of that ti"e *as the a&a!us'

Mechanical

The "e!hani!al ae is *hen *e first start to see !onne!tions &et*een our !urrent te!hnoloy and

its an!estors' The "e!hani!al ae !an &e defined as the ti"e &et*een 1+. and 16+' A lot of ne*

te!hnoloies are de$eloed in this era as there is a lare e%losion in interest *ith this area'



Te!hnoloies li0e the slide rule (an analo !o"uter used for "ultilyin and di$idin) *ere

in$ented' laise Pas!al in$ented the Pas!aline *hi!h *as a $ery oular "e!hani!al !o"uter'

Charles a&&ae de$eloed the differen!e enine *hi!h ta&ulated olyno"ial e8uations usin the

"ethod of finite differen!es'

Differen!e Enine

There *ere lots of different "a!hines !reated durin this era and *hile *e ha$e not yet ottent to a

"a!hine that !an do "ore than one tye of !al!ulation in one# li0e our "odern-day !al!ulators# *e

are still learnin a&out ho* all of our all-in-one "a!hines started' Also# if you loo0 at the si9e of

the "a!hines in$ented in this ti"e !o"ared to the o*er &ehind the" it see"s (to us) a&solutely

ridi!ulous to understand *hy any&ody *ould *ant to use the"# &ut to the eole li$in in that ti"e

A:: of these in$entions *ere HU;E'

Electromechanical

No* *e are finally ettin !lose to so"e te!hnoloies that rese"&le our "odern-day te!hnoloy'

The ele!tro"e!hani!al ae !an &e defined as the ti"e &et*een 16+ and 15+' These are the

&einnins of tele!o""uni!ation' The telerah *as !reated in the early 16s' <orse !ode *as

!reated &y 4a"uel <orse in 16,.' The telehone (one of the "ost oular for"s of

!o""uni!ation e$er) *as !reated &y Ale%ander ;raha" ell in 167=' The first radio de$eloed &y

;uliel"o <ar!oni in 165+' All of these *ere e%tre"ely !ru!ial e"erin te!hnoloies that led to

&i ad$an!es in the infor"ation te!hnoloy field'

The first lare-s!ale auto"ati! diital !o"uter in the United 4tates *as the <ar0 1 !reated &y

Har$ard Uni$ersity around 15+' This !o"uter *as 6ft hih# .ft lon# >ft *ide# and *eihed .

tons - HU;E' It *as rora""ed usin un!h !ards' Ho* does your PC "at!h u to this hun0 of



"etal? It *as fro" hue "a!hines li0e this that eole &ean to loo0 at do*nsi9in all the arts to

first "a0e the" usa&le &y &usinesses and e$entually in your o*n ho"e'

Har$ard <ar0 1

Electronic

The ele!troni! ae is *hat *e !urrently li$e in' It !an &e defined as the ti"e &et*een 15+ and

riht no*' The ENIAC *as the first hih-seed# diital !o"uter !aa&le of &ein rerora""ed

to sol$e a full rane of !o"utin ro&le"s' This !o"uter *as desined to &e used &y the U'4'

Ar"y for artillery firin ta&les' This "a!hine *as e$en &ier than the <ar0 1 ta0in u =6

s8uare feet and *eihin , tons - HU;E' It "ainly used $a!uu" tu&es to do its !al!ulations'

There are + "ain se!tions of diital !o"utin' The first *as the era of $a!uu" tu&es and un!h

!ards li0e the ENIAC and <ar0 1' Rotatin "aneti! dru"s *ere used for internal storae' The

se!ond eneration rela!ed $a!uu" tu&es *ith transistors# un!h !ards *ere rela!ed *ith

"aneti! tae# and rotatin "aneti! dru"s *ere rela!ed &y "aneti! !ores for internal storae'

Also durin this ti"e hih-le$el rora""in lanuaes *ere !reated su!h as @ORTRAN and

COO:' The third eneration rela!ed transistors *ith interated !ir!uits# "aneti! tae *as used

throuhout all !o"uters# and "aneti! !ore turned into "etal o%ide se"i!ondu!tors' An a!tual

oeratin syste" sho*ed u around this ti"e alon *ith the ad$an!ed rora""in lanuae

A4IC' The fourth and latest eneration &rouht in CPUs (!entral ro!essin units) *hi!h

!ontained "e"ory# loi!# and !ontrol !ir!uits all on a sinle !hi' The ersonal !o"uter *as

de$eloed (Ale II)' The rahi!al user interfa!e (;UI) *as de$eloed'

<ICRO 4CENARIO O@ IT INDU4TR2



India is the *orlds larest sour!in destination for the infor"ation te!hnoloy (IT) industry#

a!!ountin for aro%i"ately =7 er !ent of the U4B 1>+-1, &illion "ar0et' The industry

e"loys a&out 1 "illion *or0for!es' <ore i"ortantly# the industry has led the e!ono"i!

transfor"ation of the !ountry and altered the er!etion of India in the lo&al e!ono"y' Indias

!ost !o"etiti$eness in ro$idin IT ser$i!es# *hi!h is aro%i"ately ,-+ ti"es !heaer than the

U4# !ontinues to &e the "ainstay of its Uni8ue 4ellin Proosition (U4P) in the lo&al sour!in

"ar0et' Ho*e$er# India is also ainin ro"inen!e in ter"s of intelle!tual !aital *ith se$eral

lo&al IT fir"s settin u their inno$ation !entres in India'

The IT industry has also !reated sinifi!ant de"and in the Indian edu!ation se!tor# ese!ially for

enineerin and !o"uter s!ien!e' The Indian IT and ITe4 industry is di$ided into four "aor

se"ents IT ser$i!es# usiness Pro!ess <anae"ent (P<)# soft*are rodu!ts and

enineerin ser$i!es# and hard*are'

The IT-P< se!tor *hi!h is !urrently $alued at U4B 1+, &illion is e%e!ted to ro* at a

Co"ound Annual ;ro*th Rate (CA;R) of 6', er !ent year-on-year to U4B 1+, &illion for

>1.-1=' The se!tor is e%e!ted to !ontri&ute 5'. er !ent of India3s ;ross Do"esti! Produ!t

(;DP) and "ore than +. er !ent in total ser$i!es e%ort in >1.-1='

he Indian IT se!tor is e%e!ted to ro* at a rate of 1>-1+ er !ent for @2>1= in !onstant

!urren!y ter"s' The se!tor is also e%e!ted trile its !urrent annual re$enue to rea!h U4B ,.

&illion &y @2 >>.# as er National Asso!iation of 4oft*are and 4er$i!es Co"anies

(NA44CO<)'



India# the fourth larest &ase for ne* &usinesses in the *orld and ho"e to o$er ,#1 te!h start-

us# is set to in!rease its &ase to 11#. te!h start-us &y >># as er a reort &y NA44CO<

and inno$ <anae"ent Consultin P$t :td'

India3s internet e!ono"y is e%e!ted to tou!h Rs 1 trillion (U4B 1+='7> &illion) &y >16#

a!!ountin for . er !ent of the !ountry3s ;DP# a!!ordin to a reort &y the oston Consultin

;rou (C;) and Internet and <o&ile Asso!iation of India (IA<AI)' India3s internet user &ase

rea!hed o$er ,. "illion &y une >1.# the third larest in the *orld# *hile the nu"&er of so!ial

"edia users re* to 1+, "illion &y Aril >1. and s"arthones re* to 1= "illion'

In$e"tment"

Indian ITs !ore !o"eten!ies and strenths ha$e attra!ted sinifi!ant in$est"ents fro" "aor

!ountries' The !o"uter soft*are and hard*are se!tor in India attra!ted !u"ulati$e @orein

Dire!t In$est"ent (@DI) inflo*s *orth U4B >'+> &illion &et*een Aril > and De!e"&er

>1.# a!!ordin to data released &y the Deart"ent of Industrial Poli!y and Pro"otion (DIPP)'

Indian start-us are e%e!ted to re!ei$e fundin *orth U4B . &illion &y the end of >1.# a 1>.

er !ent in!rease in a year# a!!ordin to a reort &y IT Industry asso!iation NA44CO<'

The Pri$ate E8uity (PE) deals in!reased the nu"&er of <erers and A!8uisitions (<FA)

ese!ially in the e-!o""er!e sa!e in >1+' The IT sa!e# in!ludin e-!o""er!e# *itnessed >+

deals *orth U4B ,'6 &illion in >1+# as er data fro" Dialoi!'

Go$ernment Initiati$e"

4o"e of the "aor initiati$es ta0en &y the o$ern"ent to ro"ote IT and ITe4 se!tor in India are

as follo*sG

• <r Ra$i 4ha0ar Prasad# <inister of Co""uni!ation and Infor"ation Te!hnoloy#

announ!ed lan to in!rease the nu"&er of !o""on ser$i!e !entres or e-4e$a !entres to

>.# fro" 1.# !urrently to ena&le $illae le$el entrereneurs to intera!t *ith

national e%erts for uidan!e# &esides ser$in as a e-ser$i!es distri&ution oint'

• The Rail*ay <inistry lans to i$e a diital ush to the India Rail*ays &y introdu!in

&ar-!oded ti!0ets# ;lo&al Positionin 4yste" (;P4) &ased infor"ation syste"s inside

!oa!hes# interation of all fa!ilities dealin *ith ti!0etin issues# /i-@i fa!ilities at the



stations# suer-fast lon-route train ser$i!e for unreser$ed asseners a"on other

de$elo"ents# *hi!h *ill hel to in!rease the assener traffi!'

• The e-Tourist isa (e-T) s!he"e has &een e%tended to ,7 "ore !ountries there&y ta0in

the total !ount of !ountries under the s!he"e to 1. !ountries'

• Deart"ent of Ele!troni!s F Infor"ation Te!hnoloy and <s Can&an0 enture Caital

@und :td lan to laun!h an Ele!troni!s De$elo"ent @und (ED@)# *hi!h *ill &e a @und

of @unds to in$est in Dauhter @unds *hi!h *ould ro$ide ris0 !aital to !o"anies

de$eloin ne* te!hnoloies in the area of ele!troni!s# nano-ele!troni!s and Infor"ation

Te!hnoloy (IT)'

• The Hu"an Resour!e De$elo"ent (HRD) <inistry has entered into a artnershi *ith

ri$ate !o"anies# in!ludin Tata <otors :td# Tata Consultan!y 4er$i!es :td and real-

estate fir" Hu& to*n :td# to oen three Indian Institutes of Infor"ation Te!hnoloy

(IIITs)# throuh u&li!-ri$ate artnershi (PPP)# at Naur# Ran!hi and Pune'

<ACRO 4CENARIO O@ IT INDU4TR2

The infor"ation te!hnoloy (IT) industry has &e!o"e of the "ost ro&ust industries in the

*orld' IT# "ore than any other industry or e!ono"i! fa!et# has an in!reased rodu!ti$ity#

arti!ularly in the de$eloed *orld# and therefore is a 0ey dri$er of lo&al e!ono"i!

ro*th' E!ono"ies of s!ale and insatia&le de"and fro" &oth !onsu"ers and enterrises

!hara!teri9e this raidly ro*in se!tor'

The Infor"ation Te!hnoloy Asso!iation of A"eri!a (ITAA) e%lains infor"ation

te!hnoloy as en!o"assin all ossi&le ase!ts of infor"ation syste"s &ased on

!o"uters'

oth soft*are de$elo"ent and the hard*are in$ol$ed in the IT industry in!lude

e$erythin fro" !o"uter syste"s# to the desin# i"le"entation# study and

de$elo"ent of IT and "anae"ent syste"s'

O*in to its easy a!!essi&ility and the *ide rane of IT rodu!ts a$aila&le# the de"and

for IT ser$i!es has in!reased su&stantially o$er the years' The IT se!tor has e"ered as a

"aor lo&al sour!e of &oth ro*th and e"loy"ent'



Feat%re" of the IT In&%"try at a Glance

• E!ono"ies of s!ale for the infor"ation te!hnoloy industry are hih' The "arinal

!ost of ea!h unit of additional soft*are or hard*are is insinifi!ant !o"ared to the

$alue addition that results fro" it'• Unli0e other !o""on industries# the IT industry is 0no*lede-&ased'

• Effi!ient utili9ation of s0illed la&or for!es in the IT se!tor !an hel an e!ono"y

a!hie$e a raid a!e of e!ono"i! ro*th'

• The IT industry hels "any other se!tors in the ro*th ro!ess of the e!ono"y

in!ludin the ser$i!es and "anufa!turin se!tors'

This statisti! illustrates the a"ount of re$enue enerated &y the IT industry *orld*ide fro" >.

to >1># and also in!ludes a fore!ast for >1, and >1=' The sour!e esti"ates that in >1=# "ore

than 1#,.7 &illion euro re$enue *ill &e "ade throuh soft*are# hard*are and IT ser$i!es'

@UTURE PRO4PECTU4 O@ IT INDU4TR2

India is the to"ost offshorin destination for IT !o"anies a!ross the *orld' Ha$in ro$en its

!aa&ilities in deli$erin &oth on-shore and off-shore ser$i!es to lo&al !lients# e"erin

te!hnoloies no* offer an entire ne* a"ut of oortunities for to IT fir"s in India' 4o!ial#

<o&ility# Analyti!s and Cloud (4<AC) are !olle!ti$ely e%e!ted to offer a U4B 1 trillion

oortunity' Cloud reresents the larest oortunity under 4<AC# in!reasin at a CA;R of

aro%i"ately , er !ent to around U4B =.-7 &illion &y >>' The so!ial "edia is the

se!ond "ost lu!rati$e se"ent for IT fir"s# offerin a U4B >. &illion "ar0et oortunity &y

>>' The Indian e-!o""er!e se"ent is U4B 1> &illion in si9e and is *itnessin stron ro*th

and there&y offers another attra!ti$e a$enue for IT !o"anies to de$elo rodu!ts and ser$i!es

to !ater to the hih ro*th !onsu"er se"ent'



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