Infrastructure and employees cost is increasing in big cities, which is threatening the Indian IT industries. The Indian government has announced its plan to develop 43 new IT cities in the country that will help to tap rapid rise in demand for IT related services in next 10 – 12 years. This will help to maintain its cost effective appeal, reported The Economic Times

This move comes when BPO and Information Technology companies started losing their online business and global benefit with the emergence of small countries like Vietnam and Philippines. Those countries are offering same services at cheaper rates and are endangering India’s outsourcing status at the international market.

The plan seeks to find a way out of the situation where companies find it difficult to recruit quality employees as the allure of BPO jobs dulls and attrition rates go up. Infrastructure constraints in Bangalore, Gurgaon and elsewhere are other spanners in the work.

It is predicted that these new IT cities will provide steady supply of IT workers. The proposal, suggested by a high-level group on service sector, has been cleared by the Planning Commission. Sources said "The modalities for the ambitious plan will be finalized very soon.”

Microsoft’s plan to acquire Yahoo has gone kaput, it is planning for other alternate solutions for fixing the online branding problem. Moreover Microsoft has also ran in trouble due to its Live brand which is very similar to that of MSN. Microsoft also has Hotmail and messenger which are present in the latter too, creating confusion in the market.

Mr. Kevin Johnson, president of Microsoft’s platform and services division announced that- as the acquisition plans for yahoo has been cancelled; Microsoft would be concentrating on finding solutions for its branding problem. This speech was delivered at Search Marketing Expo conference in Seattle. He even said that during the procedure for making bids for Yahoo, the marketing team has to concentrate on other issues as well. But now they are working towards solving the brand problem altogether. According to him- Microsoft believes completely in their marketing executive and have given freedom to decide what steps should be taken to eradicate this problem. Even if launching a new sub-brand is necessary, Microsoft is ready to finance it and support the plan financially.

Johnson reported that although acquisition plans of Yahoo has been cancelled, but some other limited deals are being talked between the two companies. However he did not disclosed much details of it. He even targeted Microsoft’s main competitor Google and stated that Microsoft is ready to use unconventional ways to deal with market competition in the form of business model, user experience and the method through which a customer connects to the service.

Long back Microsoft has started working on this project, the latest example is that of Cashback service where online shoppers get money if they buy products from the listed advertisers in Live Search. This effort may alter the business model and user experience.

Microsoft has announced about a deal with Hewlett-Packard, where there will be Live search toolbar on HP PCs that would be sold in North America from next year.

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