Gartner: IT services market to grow despite credit crunch

Businesses’ expenditure on IT services will continue to grow throughout this year, in spite of the uncertain economic outlook, according to Gartner.

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Businesses’ expenditure on IT services will continue to grow throughout this year, in spite of the uncertain economic outlook, according to Gartner.

The analyst house predicted a solid 9.5 percent rise in global spending this year, taking the total to $819 billion (£411 billion). In Europe, the Middle East and Africa, the growth would be somewhat slower at 5.3 percent, equating to a €211 billion expenditure (£166 billion).

The first half of the year had shown mixed results, however. Kathryn Hale, VP research at Gartner, said that while there was much optimism at the start of the year, bolstered by decent results from the top providers, several IT services firms had since indicated that “some outsourcing contract signings are being delayed and some projects are being placed on hold”.

Outsourcing of IT and processes is the market’s highest growth area, and will represent 42 percent of services spending this year, Gartner predicted. Business process outsourcing had become particularly attractive to those firms taking big steps to curb costs, it said.

Consulting, and development and integration, also continued to exhibit steady growth, Gartner said, spurred on by the drive to cut costs and improve the return on investment on projects. These segments are due to grow 10.1 percent in the year to $327 billion (£164 billion), Gartner said.

But companies claiming a strong return on investment from their projects were hard to come by, said Hale. One problem was “the inability of providers to provide compelling value statements about the services they provide, whether in offerings or delivery”, she said.

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