The mainland is poised to become the next frontier for offshore information technology services, challenging India's role as the top offshore software outsourcing centre. 'For companies seeking offshore IT services, China is the country to watch. We expect its offshore services to mature during 2007 to 2010,' Gartner research analyst Louisa Liu said. 'It is capable of becoming one of the top-three offshore [IT service provider] countries.' Gartner Group Hong Kong research director Dion Wiggis said more United States companies chose to have their software developed in China because they believed it gave them more access to the markets of East Asia, such as South Korea and Japan, where the demand for software remained higher. He said the mainland also had an advantage over India in developing software programs based on characters rather than on an alphabet. 'India is very strong in developing software based on the Latin language, but not in developing double-bite languages. This is what China is good at,' he said. Mr Wiggis pointed out that as multinational companies expanded their global reach there was an increasing demand for multilingual software platforms, and China had an advantage. Also, mainland companies were fuelling demand for Chinese language-based software, he said. 'China's accession to the World Trade Organisation certainly has had some effect too . . . China has a huge domestic market which India doesn't have,' Mr Wiggis said. China was whittling away India's market share as more companies discovered it was cheaper to outsource their software development to China than anywhere else, including India. Since the September 11 attacks, Mr Wiggis said, United States companies had become more concerned about cost savings. Gartner's study indicates the salary package of one Chinese IT professional is roughly one-sixth the pay for their US counterpart. Mainland software exporter Golding Soft's chief operating officer Kent Hsin said the cost of developing software in China was about two-thirds of the cost in India. At the same time, costs in India were already about half those in the US. Golding Soft chief executive Ray Wen pointed out, however, that China lagged behind India as an exporter of software because standards of English were still inadequate on the mainland, and there were insufficient IT professionals. 'Most US companies don't outsource [IT services] in China because they can't communicate easily. However, with the improvement in English proficiency, the trend is going to change,' Mr Wen said. According to the China Software Industry Association, of the total HK$56.5 billion in revenue generated by China's software industry in 2000, only 6 per cent came from the export of software products. But Mr Wen believed exports would increase dramatically in the coming years, driven by additional demand from US companies. About 70 per cent of Golding Soft's revenues came from supplying Chinese-developed software to US companies. Mr Wen said the company's reported earnings to June last year of HK$14.69 million were up from HK$2.55 million in 2000.