A new information technology (IT) services unit of Chinadotcom has formed a joint venture in India with Bangalore-based vMoksha Technologies with the aim of landing more international outsourcing deals. Led by CDC Outsourcing, the India-based joint venture, which is yet to be named, aims to provide low-cost outsourcing services to software vendors and enterprises in the United States, Europe and the Asia-Pacific region. Hong Kong-based, Nasdaq-listed Chinadotcom will hold a 51 per cent interest in the venture; vMoksha the remaining 49 per cent. Financial terms were not disclosed. The joint venture will have sales and marketing offices in the US, Britain and Australia, while its offshore development work will be supported in both India and the mainland. By partnering with offshore outsourcing specialist vMoksha, Chinadotcom hoped to bolster its outsourcing operations in Shanghai. Daniel Widdicombe, chief financial officer at Chinadotcom, said CDC Outsourcing was set up to manage IT outsourcing initiatives within the group. 'The IT outsourcing business is still in its early stages in terms of the potential financial impact to the company,' he said. 'As part of our software strategy, however, we believe the establishment of CDC Outsourcing will facilitate our stated strategy of securing long-term, multiple-year contracts with recurrent and predictable revenue streams. We expect to see a growing proportion of group revenues coming from software-related businesses in the long run.' Total revenues for Chinadotcom in the quarter to March 31 amounted to US$15.4 million, up 6 per cent from the same quarter last year. Praxa - an Australian IT outsourcing and professional services organisation acquired by Chinadotcom in February - contributed revenues of US$3.4 million to the group's first-quarter results. CDC Outsourcing managing director Herman Cheng said the joint venture, once completed, would provide 'a solid outsourcing platform for the existing and future enterprise customers'. Indian firms have become leading providers of offshore software outsourcing. Their advantages include a large pool of software engineers, high proficiency in English, a reputation for quality, good infrastructure and telecommunications, laws that protect intellectual property rights and government policies that encourage IT services. Pawan Kumar, vMoksha chairman, said the partnership would enable both companies to bid on global contracts and to cross-train staff.
