TCS and Nielsen Market Research extend their contract in India

02 January 2018 Consultancy.in

Indian consulting giant Tata Consultancy Services (TCS) has signed an outsourcing contract valued at $2.25 billion (Rs. 14,400 crore) with US-based market research firm Nielsen Media Research. The new deal is an extension of the decade-long deal worth $1.2 billion (Rs. 7,600 crore) that the two firms signed in 2008.

Founded in 1996, Nielsen Media Research (NMR) is a market research corporation based out of New York. The firm lays emphasis on studying consumer behavior, primarily through understanding their media usage, spanning TV, print and radio. To this end, the firm conducts detailed consumer surveys in more than 100 countries across the world, including 47 in Europe.

The surveys are focused on determining buying trends and media habits, with the objective of developing creative insights that would best capitalise on the same. The principle behind the firm's operations is that each action performed by a consumer, whether making a purchase or surfing a website, produces a stream of data, which can be mapped and analysed for market insight.

In India, a rapidly expanding digital arena over the next few years will provide the firm with a sea of information to work with. NMR is already active in India, working in partnership with TCS since 2008 to monitor market trends in the country. Under the contract worth $1.2 billion, the consulting firm provides primarily IT services such as application development and maintenance.

TCS and Nielsen Market Research extend their contract in India

In addition, TCS also offers BPO client services, knowledge process outsourcing, management sciences, data analytics, and even assistance with financial planning. The contract, which was initially for $1.2 billion till 2020, was increased to $2.5 billion in 2013, and has now been extended by another 5 years to 2025 for a value of $2.25 billion.

Specifically, the contract expires on the 31st of December 2025, with the option of three one-year renewals for Nielsen if required.  The extension also coincides with an increasing willingness to spend on digital advertising in the Indian market, which creates a substantial market for the firm.

In a press statement, Nielsen said, “Nielsen has committed to purchase services from TCS from the Effective Date through the remaining term of the Agreement (the ‘Minimum Commitment’) in the amount of $2.25 billion, including a commitment to purchase at least $320 million in services per year from 2017 through 2020, $186 million in services per year from 2021 through 2024, and $139.5 million in services in 2025.”

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Public and private innovation are driving India's substantial digital economy

01 April 2019 Consultancy.in

New analysis from global management consultancy McKinsey & Company has reinforced what many experts have been indicating in recent times, that India is amongst the largest digital economies in the world. On a number of metrics, India is second only to China in terms of digital consumption.

The analysis comes against the backdrop of reports from a number of major consulting firms about India’s rapidly digitalising economy. In 2017, the Boston Consulting Group placed India’s population of online users at approximately 400 million, and predicted that it would reach 850 million by 2025.

Since then, experts have focused on what the emergence of such a large digital market means for various sectors, and how they are likely to grow and evolve in this context. McKinsey’s latest study offers a comparative analysis of India’s digital market against other major economies in the world.

India's global digital position

The highlight of the report is the role that the Aadhaar initiative from the Indian government has played in the development of this digital economy. Aadhaar was launched in 2009, and is essentially a digital identity mechanism that has registered as many as 1.2 billion people in accordance with their biometric information. 

The presence of such a digital identity has spelled growth for a number of other sectors that have fed off of this substantial database. The digital banking segment is one example. By the start of last year – nine years after the introduction of Aadhaar, nearly 900 million bank accounts were linked to Aadhaar information.

Not only does this represent monumental growth over less than a decade, but the number also nearly doubled since the previous year, when the number of linked bank accounts stood at just under 400 million. The digital identity database generated under Aadhaar has grown into the largest of its kind in the world.

Global digital adopters

The report attributes the overall digital growth in the country to a number of other government initiatives as well, including the Goods and Services Tax that was established in 2013, and has created a unified and harmonized database for over 10 million firms that pay indirect tax to the government.

Consequences of this expansion in the digital sphere have spread far beyond the sectors most directly affected, and India has become the second largest digital economy in the world behind only China on a number of metrics. These include the number of application downloads as well as the number of wireless phone subscribers.

The latter has been the result of the Reliance Jio initiative, which has tremendously increased the accessibility of mobile data by offering extremely cheap data plans across the urban and rural landscape. The number of internet subscribers has also grown to the second largest in the world as a result, currently at 560 million according to McKinsey.

Falling data prices in India

Increased prosperity has also led to a boom in the number of smartphones being purchased in India, currently at nearly 355 million in India, behind only China. The same global position is applicable when comparing the volume of social media engagement in India. Alongside government initiatives, the report attributes this scenario to innovation in the private sector as well.

“Global and local digital businesses have recognized the opportunity in India and are creating services tailored to its consumers and unique operating conditions. Media companies are making content available in India’s 22 official languages, for example,” says the report.