Editor's Note: Consolidation? Think Innovation - InformationWeek
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Stephanie Stahl
Stephanie Stahl
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Editor's Note: Consolidation? Think Innovation

Let's do a quick word-association game. Tell me the first thing that comes to mind when I say "Oracle." "Consolidation," you say? How about "telecom"? "Consolidation." OK, how about "software"? "Consolidation." How about "India"? "Outsourcing." OK, we'll get back to that in a minute.

As consolidation continues in the software and networking industries, some people may conclude that competition is waning, choices will be slimmer, prices will surely to go up, and we'll be locked in forever. That might be true if innovation were to stop right here and now. But that's not going to happen. There's a healthy pipeline of venture-backed startups, investment dollars, and companies that have yet to emerge from their garages or wherever they're setting up shop to work on the next big thing. There are plenty of emerging technologies and bright ideas percolating in research labs. There's a slew of new open-source software options screaming onto the market.

There's also an emerging source of new business applications coming from India. Everyone I know in business technology who visits India comes back with a whole new perspective about the talent and innovation brewing there. While IT services represent the biggest portion of the country's revenue ($13 billion), revenue from software sales and R&D increased 30% last year to $3 billion, and that number will certainly rise as more companies develop apps that help automate the back office and sit in front of the customer (see story, "India's Next Step"). With India becoming a hub for software startups, customers may also feel the impact on software pricing. In another year, the word-association game may change. Software might prompt you to say "innovation" and India might prompt you to say "business apps." Chances are, though, Oracle might still prompt you to say "consolidation."

Stephanie Stahl

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