Information technology and IT-enabled services will employ 4 mln people in 2008 and account for 7% of GDP and 33% of India’s foreign-exchange inflows, according to Nasscom.
Indian outsourcers to earn $220-280 bln by 2012
Everest Research Institute found that the addressable market for Indian BPO outsourcers will be $220 bln to $280 bln by 2012. Today, the report says, the total offshore BPO market is about $28 bln, with the Indian-sourced portion of that at $10.2 bln.
European outsourcing worth $40.9 bln in 2007
The value of outsourcing deals signed in Europe in 2007 was $40.9 bln, compared with $26.6 bln in the Americas, according to TPI.
Indian outsourcing companies to earn $10.73 bln by 2011
India’s IT services market is forecast to grow to $10.73 bln by 2011, at a 5-year CAGR of 23.2%, according to Gartner.
Outsourcing to grow 8.1% in 2008
The global outsourcing market continues to grow at a steady pace, with a forecast growth rate of 8.1% in 2008. Publicly reported IT outsourcing (ITO) and business process outsourcing (BPO) contract values decreased overall by 50% in 2007, Gartner reports. Indian providers are growing approximately 40% annually in the US and 60% annually in Europe.
Indian software salaries up 18.7% in 2006
Employees in the software development and IT sector saw their salaries raised at an average of 18.7% in 2006 in India, IDC reports.
New Asia-Pacific outsourcing contracts command $25 mln
The total value of new (as opposed to renewed or restructured) outsourcing contracts to Asia-Pacific in the $25 mln plus bracket – where most significant outsourcing activity occurs – is $5.4B, an increase of 100% on the first half of 2006. Eight BPO contracts, in the $25 mln or greater category, with a total contract value of $700 mln were signed in Asia-Pacific in the first half of 2007, representing growth of 33% by volume and 133% by value compared to the first half of 2006, TPI says.
HR services up 8% in 2006
In 2006, HR services spending started to level off and grew 8% worldwide over 2005, according to IDC. The worldwide market for HR services in 2006 showed an increase of 8% over 2005. In the United States, HR services grew 8.7%.
Small business who outsource IT end up spending less than 5% on maintenance and upgrades
The majority of SMBs that outsource (54%) spend less than 5% of annual revenues on maintaining and upgrading IT infrastructure, while 64% of non-hosting companies spend more than 10% of revenues on IT. Companies that outsource (68%) are much more aggressive about using IT assets to engage in e-commerce than companies that manage technology infrastructures internally (29%). By more than 85%, outsourcers report that their IT organizations play an important role in remaining competitive in their respective industries than those that do not outsource, ThePlanet reports.
87% of outsourcing buyers to continue outsourcing
87% of companies interviewed by KPMG mentioned they planned to keep outsourcing level the same or increase it. 42% of the organizations believe that their sourcing contract has definitely improved their financial performance, and 27% said that sourcing has definitely improved their competitiveness.
HR outsourcing to grow to $18.9 bln by 2010
Human resources (HR) business process outsourcing (BPO) is the fastest-growing segment of HR services and will grow at a compound annual growth rate (CAGR) of 16% in the United States, reaching $18.9 bln in spending by 2010. In 2004, 37% of US HR outsourcing spending was on HR BPO services. IDC projects that HR BPO services will continue to grow, reaching 46% of HR outsourcing spending in 2010 as the market solidifies and leaders achieve profitability through economies of scale.
Asia-Pacific IT outsouring market reached $10.9 bln in the first half of 2006
According to IDC, the total ICT Outsourcing and Managed Services market in the Asia-Pacific region topped $10.9 bln in first half of 2006. IDC expects the total market for 2006 to reach $23 bln, or an annual growth rate of 12% over 2005. However, Value Added Managed Services (VAMS) is expected to outpace the entire market with a growth rate of close to 20%. This compares favorably with growth rates of 5-6% for enterprise wide outsourcing and 9-11% for managed connectivity.
Brazilian printing outsourcing up 42.5% in 2005
Brazilian printing outsourcing market achieved record YTY growth of 42.5% in 2005. Nearly 8 bln pages were printed by the use of such service as a whole in 2005. 41% of the 500 largest enterprises in Brazil have outsourced printing. Another 20% of the remaining companies intend to do so up to the end of 2006, when large contracts in the finance and industry sectors are expected to stand out, IDC says.
What law companies outsource
Almost two-thirds of US law companies said their firms had outsourced some functions within the past year and more than half reported that their firms had begun outsourcing some functions five or more years ago. The most frequently outsourced functions were related to documents?mailroom, messenger, and reprographics. The second-most frequently outsourced functions were administrative: travel and food services.
Less than 20% of firms surveyed outsource IT functions, but many were open to doing so in the future. Very few firms outsource accounting functions or plan to do so in the future. More than 90% of respondents reported that the companies they employed for outsourcing are located in the continental US More than 60% of those who outsourced functions said they did so primarily because outsourcing allowed them to focus on core competencies. More than one-third also cited cost savings, ALM Research says.
IT offshore spending to reach $29.4 bln by 2010
According to IDC, the global and US markets for offshore IT services continue to grow at a remarkable rate, driven primarily by US customer demand. IDC predicts that offshore IT services vendors will capture $29.4 bln in worldwide customer spending by 2010, with little sign of a market slowdown.
Top 100 Western European outsourcing deals generated $40.5 bln in 2005
The total value of the top 100 Western European outsourcing deals reached $40.5 bln in 2005, according to IDC. This compares with $42.1 bln in 2004. In 2005, however, the largest deals got bigger, with nine megadeals signed for a total of $20.5 bln. IS outsourcing and network and desktop outsourcing (NDOS) account for the lion’s share of the aggregate value of the top 100 deals, at a combined $32.7 bln. BPO adoption continues to provide encouraging signs, but adoption has not met expectations. Growth rates in BPO across Western Europe still make this one of the most attractive markets in pure growth terms, but outside of the UK the net value of the market is very small. IBM has lost pole position in the Western European top 100 outsourcing deals regarding aggregate value of deals. While IBM signed 14 deals in 2005, more than any other vendor, the aggregate value was not enough to offset larger-scale wins by BT Global Services and EDS.
Mobile network outsourcing to grow to $55.3 bln by 2010
Pyramid Research is forecasting the total outsourcing opportunity for mobile network vendors ($51.5 bln in 2005) to increase to $55.3 bln by 2010 for a 1% CAGR. The outsourcing opportunity is growing healthily, at an 8% CAGR.
Outsourcing spending by Asia-Pacific companies to reach $16 bln in 2010
IDC predicts that the amount spent on outsourcing by companies in Asia-Pacific (excluding Japan) will exceed $10 bln in 2006. India and the PRC will continue to be the high-growth markets in the next five years. With CAGR of 19% and 31% respectively over 2005-2010, these markets are not expected to have fully matured by 2010. This strong buildup is primarily driven by the large infrastructure growth over the past several years. The management of this infrastructure is now evolving to become a natural add-on, especially in the PRC where users have historically been lagging in outsourcing. IDC forecast that the market will grow from $9.58 bln in 2005, to $16.06 bln in 2010. This represents a compound annual growth rate (CAGR) of 10.9% over the forecast period.
Global procurement BPO market generated $627 mln in 2005
IDC estimates that the worldwide procurement BPO market reached $627 mln in 2005, and will expand at a five year compound annual growth rate (CAGR) of 22.3% to reach $1.7 bln by 2010. The study reveals that growth in customer spending is accompanied by a more crowded and diverse competitive landscape, with more aggressive activity coming from newer entrants such as services procurement BPO providers and Indian offshore BPO providers.
Indian software and backoffice industry generated $23.6 bln in fiscal 2005-2006
India’s software and backoffice services industry recorded 33% growth in export revenue to $23.6 bln in the year to March 2006. This included $6.3 bln from services like call centres, payroll processing, claims management and high-end financial analytics. Including the domestic market, the sector expanded 31% on year to $29.6 bln. Overall software and services revenue is projected to grow 25-28% to $36-$38 bln in the year to March 2007. Exports are likely to grow 27-30% to between $29-$31 bln. The United States is the biggest market for Indian software firms, accounting for as much as 70% of revenue.
1 mln US jobs to be outsourced by year-end 2006
The number of jobs offshored from the US to India and elsewhere has tripled since 2003, to a projected total of 1 mln in 2006, with roughly 25% of them in high tech.
European service providers plan to increase offshore assets by 65%
According to a new IDC study, European service providers are quickly building up offshore capabilities. Large and medium-sized European service providers have already established themselves in a number of offshore locations such as India, Eastern Europe, and South America to compete with offshore-based and global service providers such as Tata Consultancy Services, Wipro, IBM, and Accenture, and plan to increase their offshore assets by 65% during 2006.
16 outsourcing megadeals awarded in 2003, 12 in 2004, 11 in 2005
In 2005, 11 outsourcing megadeals (deals with revenue above $1 bln) were awarded, a decline from 12 in 2004 and 16 in 2003, Gartner says.
130K US jobs offshored so far in 2006
MSNBC quotes Forrester Research on the number of US jobs offshored in 2006 – 130K so far, 3.5 mln by 2015.
Payments outsourcing generated $3.3 bln by 2005
IDC estimates that US spending on payments BPO services reached $3.3 bln in 2005 and will grow at a 5-year CAGR of 4.2% to reach $4 bln by 2010. This increasing trend of payments outsourcing presents new opportunities and challenges for financial institutions and payments processing vendors.