BPO industry to become more domestic, revenues to reach $6.8 billion in 2013: IDC

With the international business process outsourcing (BPO) market drying up, India is now set to shift focus on the domestic market, which is projected to grow at over 30 per cent annually, says a new study.

A report by IT research firm IDC India says the country's domestic BPO market, with nearly 500 service providers, will grow at a CAGR of 33.3 per cent to touch revenues of $6.82 billion by 2013 from $1.62 billion in 2008.

The report said the domestic BPO industry would evolve from just running isolated processes for customers to engaging more deeply in identifying and transforming core business processes.

This implies that rather than merely running isolated processes for customers, BPOs would engage more deeply to identify and transform core business processes to add greater market value in the ''creation and delivery of end products and services''.

"Positive market indicators of an economic recovery, unbundling of mega outsourcing deals and large unaddressed white spaces such as regional language services support the current optimism," the report said.

IDC is a global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets.

The BPO industry currently offers a range of services from customer care to research and analytics. The BFSI vertical contributes the lion's share of 37 per cent to revenues, followed by telecommunications contributing one-fourth to it.

Other verticals - utilities and services, energy, food and hospitality, aerospace and automotives, consumer durables, government - contribute 17 per cent, while the travel segment contributes 8 per cent to the revenue.