Fast-changing large IT services contracts come with strings attached

Clients want to pass on risks to vendors as they push cost optimisation

The contours of large deals bagged by Indian IT services majors are changing fast. Most of these deals come with riders where service providers must do a lot of rebadging of employees and invest upfront for clinching these multi-year contracts. 

Analysts are of the opinion that clients are increasingly looking at cost optimisation by passing on the risks to the IT vendors. This is one of the prime reasons behind such conditions being attached to the contract. 

IT services players are demanding longer tenure deals to hedge their risks. So, the mix of these two factors are giving rise to