APEJ Outsourcing to Grow Rapidly Through 2010

In its latest forecast of the IT services marketplace for the Asia/Pacific excluding Japan (APEJ) market, IDC predicts that infrastructure outsourcing growth within the region will more than double that of hardware deployment and support services.

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In-depth findings are published in the recently updated report, Support to Management: The Continuum of Infrastructure Services in Asia/Pacific (Excluding Japan)

IDC forecasts the network and desktop outsourcing market is poised to grow from $2,141.4 million in 2005 to $4,463.8 million in 2010, representing a CAGR of 15.8%. From a value of $4,135.7 million in 2005, the hardware deployment and support market will grow at a CAGR of 7.8% to $6,013.6 million by 2010. This is despite the proliferation of infrastructure build-outs in the region.

“Organizations throughout the region are maturing in their understanding of IT’s role in driving business strategic functions as opposed to merely sustaining operations,” said Richard Pirrit, research manager for IDC’s Asia/Pacific Support Services, in a statement. “Furthermore, as businesses begin to understand the potential value-add that IT can bring, they are increasingly looking towards service vendors for value-add services.”

Some other key findings around the continuum of support and outsourcing services include:

There is a progression, or continuum from hardware support to network and desktop outsourcing as organizations mature in their IT usage. This progression is signified by organizations seeking the greater relationship depth offered by network and desktop outsourcing in comparison with hardware support services.

The alignment of business functionality to IT capabilities means organizations throughout the region are increasingly looking to vendors to manage the strategic decisions in regard to the infrastructure. This is resulting in network and desktop outsourcing growing at a faster rate than hardware support services in the region.

The progression from hardware support to network and desktop outsourcing can be observed throughout the entire region. All countries in APEJ are forecast to grow at a higher rate in the network and desktop outsourcing market than the hardware support market. This signifies the general shift toward the more sophisticated engagements with external IT service providers that organizations are seeking throughout the region.

“While the provision of outsourcing had previously belonged to the domain of IT giants like IBM, EDS and CSC, we are seeing an increase in the supply of these services as niche players and telecommunication service providers have begun to offer these services to compensate for the decline of their core business,” said Eugene Wee, senior market analyst for IDC’s Asia/Pacific IT Services, in a statement.