Now it is like a rule that once a company is founded may it be from any domain, it has to have its website. Few years ago when this unwritten rule did not exist and internet market was on boom each and every industry started going online. Everyone started entering into the process of changing manual tasks to computerized ones. This period of metamorphosis boomed the IT services industry. Getting a high profile and wealthy client plays a major role in success of the service provider company. There are many million dollar Indian companies in this sector at present.
IT industry has grown, in size as well as from infancy to adulthood over the years. IT services is definitely a good area, it caters to specific needs. But do we want to continue getting paid for efforts and not for innovation? Does India give birth to companies like Google or Apple? We can take the outsourced product development to India or contribute to product development in MNCs in India. But can Indian IT companies give a product which is being widely used? As of now we must be have just a few, countable on hand number of products originating out of purely Indian IT company. Yes startups have contributed to the list of products which are being used world wide and there are Indian products popular on web like SlideShare. But the pie of these ones is too small compared to the total size of our IT industry.
I agree that product development is in its childhood phase here. For startups it is a matter of prolonged wait period for achieving success, which means higher risk. Services is immediate money (money as per work/time) kind of business. If you have client and hence work then you are earning. It faces lower risk as against product development which is a matter of tremendous patience where you know success or failure only after the launch of the product. It is high time that we change our image from cheap programming cost to great innovators.
I've heard many entrepreneurs say- 'we actually wanted to develop product, we've our ideas too; but to generate revenue we are into services. We'll start working on product once we get enough money'. I'm very curious to know and see really how many of them can migrate to product development! Is our ecosystem still not mature enough to promote working on something without ROI? Do we want to continue with time and material billing? Or we want to get paid for innovation??