"For many local CIOs, talent or resources buying is often the purpose of outsourcing, so proximity of the universities becomes a factor," said Darren Tan, associate director of consulting at Gartner. Instead of buying resources and talent, the essence of outsourcing is to purchase a provider's output, which includes its capabilities, experience and sometimes even corporate culture and governance policy.

"[In this case] China still needs some time to become a mature outsourcing provider like its counterpart India," said Tan. When multinational corporations (MNCs) with mature IT shops seek for outsourcing partners, they look for track records and experiences similar to themselves. "Therefore many MNCs continue to turn to the big players in China as their outsourcing partners."

"We see China with a lot of facilities in outsourcing," added Mike Ettling, VP and general manager of Unisys' Asia Pacific outsourcing and infrastructure services. "So there are cheap and plentiful datacenters to utilize but they cannot offer the process and best practice for any advanced ITO/BPO."

Nevertheless, Tan noted China has a much steeper learning curve than India.

"China will need to go through the same process as India to build that experience and track record to become a mature provider," he said. "But the country will take a much shorter time to mature, as India has paved the learning path."