15 May 2008
Companies will spend more than $746 billion (£384 billion) on external services in 2008, a 6.8 per cent increase over 2007.
That is according to IDC, which predicts global services spending will reach $965 billion (£496 billion) by 2012, becoming a trillion-dollar market soon after.
The analyst explained that IT made up 74 per cent of the overall services market in 2007, but added that the business services market is gradually beginning to increase its market share.
It also claimed that new and often disruptive delivery methods, such as hosting and software-as-a-service (SaaS), are encouraging service providers and outsourcers to focus their investments in these areas, further contributing to market growth.
"The worldwide services competitive landscape keeps intensifying with many new entrants with new business and pricing models as well as the strengthened capabilities of up-and-coming players that are extending their reach into new markets," said Marianne Hedin, of IDC.
"This is a time for service vendors to aggressively review their portfolio of offerings, account targets, investment strategies, business processes, and delivery practices."
A recent survey from IDC revealed that 16 per cent of employees in industrialised countries are now "hyper-connected", using a minimum of seven devices and nine applications for work and communications every day.
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