Apple to quadruple investment in India with new software outsourcing contracts

Whilst onlookers are focusing their attention on Apple’s iPhone and iPad supply chain to gather information on the company’s next-generation smartphone and tablet devices, little is known about how it outsources its app development and maintenance work.

Thanks to the Times of India, a little more light has been shed on how Apple chooses its software suppliers, helping it develop applications to be used by the company but also testing software that is either to be utilised or released by the company.

At the end of January, Apple’s chief information officer (CIO) Niall O’Connor visited India, meeting with two of the country’s biggest consultancy firms — Infosys and Wipro. Apple already contributes millions of dollars to both companies, but is reportedly ready to quadruple its investment in India thanks to its industrious workforces and lower outsourcing cost.

Apple’s current India spend totals around $100 million, accounting for nearly a fifth of its global outsourcing spending. The company already shares about $50 million in annual business with Infosys, and Wipro has become Apple’s go-to source for application and software testing.

The details of O’Connor’s visit are scarce, thanks to the high levels of secrecy the Cupertino-based technology giant employs to keep its operations from being shared with outsiders.

O’Connor is credited with transforming Apple’s worldwide IT organisation by implementing a “streamlined, simplified systems environment,  integration of Apple’s state-of-the-art enterprise products; and a fine-tuned cost model that allows for a significant increase in spending on development and enhancements.” This suggests his visit will not only continue to expand Apple’s internal operations but also ensure it can continue testing and developing software for public release, helping expand its retail point-of-sale systems and stay on top of supply demands.

Given Apple’s huge draw, companies are falling over themselves to work with the smartphone and tablet maker, seeing a signed contract with it as a ‘badge of honour’. Many often forget that for Apple to remain the world’s biggest technology company, it needs to ensure its internal systems and software continue to evolve to match its growth.

For Infosys and Wipro, they are all to happy to conduct software audits and perform tests; Apple’s cash pile is huge and they will hope that its increase in spending will help propel their companies forward.