The Bangalore Brand
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Case Code: ECON014 Case Length: 14 Pages Period: 1985-2004 Pub Date: 2004 Teaching Note: Available |
Price: Rs.400 Organization : - Industry : - Countries : India Themes: Business Environment |
Abstract Case Intro 1 Case Intro 2 Excerpts
"Fifteen years ago, not one in 1,000 Americans could spot Bangalore on the map. Today, six out of seven think Bangalore is the only city in India. They basically believe 1 billion people live in Bangalore."
- Tom Peters in 2002.
Introduction
Referred to as the 'Silicon Valley of India,' Bangalore, the capital of the southern state of Karnataka, had a population of 5,686,8442 in 2001, making it India's fifth largest city (Refer to Exhibit I). Around 1300 information technology (IT) companies operate in Bangalore and it is home to around 110,000 technology workers. This is in addition to the 60,000 people working in Business Process Outsourcing (BPO) firms. In 2003, on an average, two research and development (R&D) centers of MNCs were opened every week in Bangalore. AMD, AOL, Cisco, Dell, Delphi Automotive Systems, Deutsche Bank, Eastman Kodak, E&Y, Google, HP, Intel, IBM Corp, Motorola Inc., Oracle, Lucent, Nortel Networks Ltd, SAP, Tektronix, Texas Instruments, and Yahoo have a presence in the city and some of the Indian IT majors like Infosys Technologies (Infosys), MindTree Consulting (MindTree), Wipro Technologies (Wipro) etc., are headquartered in Bangalore.
Fourteen of the top 20 IT exporters in India (Refer to Exhibit II) have a development center in the city. The anti-outsourcing debate in the US in the early 2000s could not stop an outflow of Rs. 19.7 billion as foreign investment to Bangalore in the year 2003-04 to set up 110 software and BPO companies. Also during the year, software exports from Bangalore constituted around 36 per cent of the total exports from the Software Technology Parks of India (STPI). In the previous year too, Bangalore had been the leader in software exports (Refer to Exhibit III). Of the $4 billion IT export revenues from Karnataka in 2003-04, 95 percent came from Bangalore. The first four months of fiscal 2004-05 have seen 61 IT companies setting up operations in the Garden City.
Bangalore has been reported as the largest job-creating city in India with more than 65,000 jobs likely to be created in 2004.6 However, the rapid growth of the city has resulted in infrastructural bottlenecks like traffic congestion, lack of hotel accommodation, lack of public service amenities etc., in the recent past. The Bangalore brand has also been facing stiff competition from upcoming cities like Hyderabad7 and Chennai8, for being projected as the IT hub of India. With the support of the respective state governments, these cities are being projected as the alternative destination for new IT ventures.
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