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Trend #3: Product Engineering Is Headed Offshore

New versions, new features, and new products are the lifeblood of the enterprise software industry. To survive, startup and established companies have to bring products to market faster, and more companies have begun outsourcing product development to specialists skilled in enterprise software product engineering.

A good example is San Francisco–based Embarcadero Technologies, a leading provider of database and application lifecycle-management solutions. Embarcadero relied on Aztec Software, which is headquartered in California and has an offshore development center in Bangalore, India, to help it take a new integration product, Embarcadero DT/Studio, through the entire product lifecycle—from development to maintenance. Aztec's work on the DT/Studio tool helped Embarcadero more quickly establish a competitive market position for the product.

What does this mean for you? If you're in an enterprise software firm, the chances are high that your company is considering or is already offshoring certain functions such as application testing and version maintenance. In fact, we're seeing many venture capitalists in the Silicon Valley forcing their portfolio companies to move in this direction.

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