TCS Sees Billion-dollar Business in SMB Cloud Computing

By Greg BrownIndian outsourcing giant Tata Consultancy Services (TCS) believes that it can grow a new cloud computing initiative, named iON, into a $1 billion business inside five years in India, eventually expanding it outside the country. The global services company says it will do so by offering cheaper computing to small and medium-sized businesses (SMBs), putting it squarely into competition with global competitors such as IBM and Microsoft.

TCS projects savings of 30 percent to 40 percent for its clients.

“We have identified manufacturing, retail, healthcare, education, and professional services (legal, auditing, for instance) as five major revenue drivers in India for iON,” V Ramaswamy, global head for the project, told the Hindustan Times.

The offering has been in a pilot phase for nearly a year and serves about 130 clients, according to TCS Chief Executive N Chandrasekaran, who wants to ramp up the customer base to at least 1,000 in a year’s time.

“Current revenues from the services is practically negligible, but within the next five years we hope to get at least a billion dollars,” Chandrasekaran said.

TCS has clearly made its mark on Latin America – establishing a formidable presence across the region, and far outdistancing other major Indian-based rivals. The firm has hired over 7,000 associates in markets such as Chile, Mexico, Colombia and Brazil and expectations are that expansion will continue in these and other LatAm markets.

The new cloud offering will combine hardware and software components to offer solutions that address specific requirements of SMBs, who can pay for the services on a monthly basis as they would for a typical utility service like electricity, according to TCS.

TCS says the project is part of a plan to increase “non-linear” growth to 10 percent of total revenues, cutting the need to increase headcount for the company to grow.