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Abhrajit Gangopadhyay

Bangalore , Sept. 22

TWO of top 10 clients of software exporter Infosys Technologies Ltd, Northwestern Mutual and Aetna Inc, have cut rates with the vendor to the extent of 8-10 per cent, company sources said.

However, Infosys spokesperson said: "We cannot comment on client contracts".

Aetna contributed close to $50 million or nearly 4.6 per cent of Infosys' April-June quarter revenue and Northwestern was the top client with contribution close to 5.7 per cent to last quarter's revenue.

Analysts believe that such rate cuts have come on the back of volume discounts and the company was likely to have factored such drop in its guidance.

"We think it was captured in the earnings guidance, since the company said it had factored a one per cent price drop quarter on quarter", a software analyst with a European brokerage said.

The recent development comes in the wake of widespread belief among industry trackers that pricing pressure has stabilised to some extent and there could be upsides seen in certain sections clients in near term going forward. It can be recalled that Infosys had announced in March 2001 its plan to double its team working on Aetna by that year-end. Meanwhile, in 2002 March, Infosys had said it would develop and launch an online funds transfer option for Northwestern Mutual's variable life and annuity policyholders. Infosys entered into relationship with Northwestern way back in 1996, when it was hired to address Y2K initiatives.

Both the accounts have grown ever since, as the clients shipped more work offshore in a bid to compress their costs.

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