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Software/IT Services/Business Process Outsourcing
Wipro ventured into production of soaps, shampoos, baby powder and other consumer products,
as well as the manufacture of light bulbs in a joint venture with General Electric. In 1975,
the Wipro Fluid Power unit was launched to make hydraulic and pneumatic cylinders.
At around that time, the government of Indira Gandhi passed the Foreign Exchange Regulation
Act, which required foreign-owned firms to reduce their equity stakes to a minority position in a
joint venture. IBM, which had operated in India since the 1930s, was asked to reduce its ownership
to 26%. It refused and closed down operations in 1978, creating an opening for India’s nascent
computer and software industries. At the same time, duties on computer imports were set at
300%, creating an incentive for domestic industry to import components and assemble branded
Indian computer hardware.
In 1980–81, Wipro branched into IT services and mini-computers that it built in India under license
from a U.S. firm, Sentinel Computer Corp. In 1983, it released Wipro 4-5-6, a knockoff of
the Lotus 1-2-3 spreadsheet/database program. In 1985, it began assembling personal computers in
India for Taiwanese manufacturer Acer, eventually releasing a branded personal computer in 1986.
Wipro BioMed, a business unit to market and service bio-analytical and medical diagnostic equipment,
was formed in 1988, followed by a 1989 joint venture with GE Medical Systems.
Wipro began the transition from computing and software products to services in 1990, as it became
apparent that tariffs would soon be reduced and the Indian market would open to foreign
competition. The company added a finance arm in 1992 and was listed on the New York Stock
Exchange in 2000.
An acquisition spree in 2002 netted Indian BPO firm Spectramind for $175 million; Ericsson’s
India R&D centers, with 300 employees in Bangalore, Hyderabad and New Delhi; the global energy
practice of American Management Services, with 90 domain experts and IT consultants and
50 electric utility and transmission clients in the U.S. and Europe, for $26 million; and NerveWire, a
Newton Massachusetts financial services IT consulting firm with 90 consultants and 40 major firms
in the banking and securities sector, for $18.7 million.
The Ericsson R&D operation, plus a series of small acquisitions in 2006 and a Motorola joint
venture, WMNetServ, all positioned Wipro as a significant player in wireless chip design and
network managed services. A high-end 90-nm graphics processor developed jointly with Santa
Clara software startup Ageia Technologies for Nvidia, led to Nvidia’s acquisition of Ageia in
February 2008.
Wipro’s 2007 acquisition of New Jersey-based Infocrossing for $600 million provided Wipro
with five U.S. data centers, some 900 employees, and a well-regarded U.S. brand with which to
market remote infrastructure management services in the U.S.—most notably to health care and
government clients. (Infocrossing served over 90 managed care organizations, processing 175
million claims annually, at the time of acquisition; over 2005–06, the Missouri State Department
of Social Services accounted for 10% of Infocrossing’s business.)
Wipro earned about $1.5 million in annual revenues when Azim Premji took over in 1966. In
fiscal 2007-08 it made $806 million in net income on revenues totaling $4.93 billion, of which
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