Worldwide IT services revenue totaled $748 billion in 2007, a 10.5 percent increase from 2006 revenue of $677 billion, according to Gartner, Inc.

“This strong growth, combined with strong first quarter results for market leaders, runs counter to the gloomy and widespread economic concerns arising in the United States,” said Kathryn Hale, research vice president for Gartner’s worldwide IT services group. “Many providers are successfully selling buyer value propositions that external spending on IT services and solutions can help customers save money and be more productive, even in a profoundly uncertain economic climate.”

The Indian domestic IT Services market grew 18 percent in 2007 (in Indian Rupee terms) clearly outperforming overall Asia/Pacific IT Services growth rate. “While cost remains a key consideration for users in the outsourcing services market in India, operational efficiency and business agility is driving most of the IT Services engagements”, said Arup Roy, senior research analyst, Gartner.

Across all IT services, IBM continued to be the worldwide market leader (see Table 1), with 7.2 percent of the market. IBM and Accenture delivered strong growth rates, 12.2 percent and 19.7 percent, respectively, and were the only companies in the top six that experienced revenue growth rates above the overall market average.

Table 1
Worldwide IT Services Vendors by Revenue (Millions of U.S. Dollars)

Source:

Gartner (May 2008)

While global sourcing makes the location of a provider’s headquarters increasingly less relevant, Gartner tracks this information for more than 360 vendors who collectively account for more than 70 percent of end-user spending worldwide. While India-based vendors’ IT services revenue grew 38 percent in 2007, these companies earned only 4.1 percent of revenue tracked, and U.S.-based vendors dominated the IT services market with 55.4 percent of that total.

“To build on their success in 2007, service providers should focus on selling services that will deliver visible return in 2008, either in cost, speed to market, or business impact,” said Ms. Hale. “They should also focus on growing sales in emerging markets that enjoy faster-growing economies and high growth rates in IT services.” 

Sourced From: Text 100 Public Relations Consultancy