Outsourcing the Offshore Operations

This recent article in BusinessWeek by Steve Hamm points to the growing trend of "Western companies are increasingly getting away from running their own offshoring operations, handing the jobs over to Indian tech-services specialists".

The article cites the recent $228 million purchase of Aviva's 5,000 strong operation by WNS (which itself was a spin off of British Airways India captive), Infosys acquisition of Phillips Electronics offshore arm and of course the pivotal event of GE spinning out the majority stake of its India operations to Genpact in 2005.

The reasons for this shift are noted to be the increased economies of scale which the offshore outsourcing specialists can bring to bear. The overhead costs of managing an offshore operation which can decimate costs savings of an offshore operation are also a reason for this shift.

Are we looking at the beginning of the end of "offshore captives" as we know them?