Wednesday, 14 June 2006 15:33

Asia Pac IT services doubles global growth rate

The IT services market in the Asia Pacific region grew more than twice as fast as the world as a whole in 2005, according to new research. Worldwide IT services revenue totalled US$624.4 billion in 2005, a 6% increase from 2004 revenue of US$588.9 billion, according to IT analyst firm Gartner.

Meanwhile, Asia Pacific's IT services market revenue grew 12.7% to US$38 billion in 2005. However, as in 2004, currency appreciation in Asia Pacific played a major role in artificially boosting IT services market growth in this region in 2005. If the local currencies in Asia Pacific countries held constant in 2005, the region would have grown by just 7.5%.

For the first time since 2000, software support and project-based services outpaced outsourcing services as the key growth area for the worldwide IT services market.

IBM continued to be the worldwide market leader, but its growth rate was well below the industry average at just 2.5%. Second placed EDS fared even worse, with negative 0.5% growth rate. Third and fourth placed Fujitsu and HP were also below the global average, growing 5.9% and 4.1% respectively. Fifth and sixth placed Accenture and CSC were the only vendors in the top 6 that experienced revenue growth rates above the overall market average. However, while sixth placed CSC came in just above the global average at 6.1%, Accenture was the standout performer, posting growth of 13.1% in 2005.

Healthcare organisations provided the greatest growth in spending on external IT services providers in 2005, however this segment is relatively small compared to other verticals. The healthcare category increased its spending from $17.9 billion in 2004 to $19.4 billion in 2005, representing a growth rate of 8.7%. The financial services market continued to be the largest vertical for IT services revenue with revenue totalling $141.3 billion in 2005, a 7% increase from 2004.

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Stan Beer


Stan Beer co-founded iTWire in 2005. With 30 plus years of experience working in IT and Australian technology media, Beer has published articles in most of the IT publications that have mattered, including the AFR, The Australian, SMH, The Age, as well as a multitude of trade publications.





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