New Delhi, Nov. 18 -- Sonata Software Ltd has dropped two places in Indian IT's pecking order because of a steep decline in second quarter revenue, primarily caused by Microsoft Corp. selling its software licences directly to large clients.

Such software reseller business used to make up for more than 60% of Sonata's revenues. Microsoft, like other large software companies, had earlier sold much of its licences through third parties such as Sonata. Now, it is looking to sell to large clients directly. While this has happened in the past, Sonata's management said it's a first in Asia.

Bengaluru-based Sonata, as a result of its topline contraction, is now the country's thirteenth-largest IT outsourcer after it lost ground to L&T Technolog...