Wipro delays plan to open software center in Atlanta

By John Ribeiro

November 10, 2008 12:00 PM ET

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Computerworld - Offshore outsourcing vendor Wipro Ltd. is delaying its plan to open a software development center in Atlanta, a decision that the India-based company said was driven by the global economic downturn.

Wipro announced in July 2007 that it planned to set up the Atlanta facility in order to increase its U.S. workforce and boost its ability to do onshore application development and other IT work for U.S. customers. At the time, Wipro officials said they expected the development center to employ up to 1,000 people within three years.

The plan also called for the outsourcer to add three more U.S.-based software centers at unspecified later dates.

But in a statement last week, Wipro said that the economic problems and stock-market turmoil have made it harder to get the attention of potential customers. "We are not shying away from what we plan to do in Atlanta, but it is taking more time than expected given this [economic] scenario," the company said.

Wipro recently reported a 36% revenue increase year over year for the third quarter. But its profits grew only 1.3%, and Wipro said its short-term outlook is cautious because of the global economic strains.

Consulting firm Technology Partners International Inc. said the third quarter is historically a weak one for outsourcing deals. But this year's was the softest that TPI has seen in 10 years.

This version of the story originally appeared in Computerworld's print edition.

Read more about management in Computerworld's Management Knowledge Center.

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