Gartner Says Worldwide IT Outsourcing Market to Reach $288 Billion in 2013


According to Gartner, accelerated buyer plans related to bring your own device (BYOD), and reduced enterprise support requirements for end-user devices produce a more tempered outlook for end-user outsourcing than in past quarters. Outsourced support for mobile end user devices will see strong growth through 2017 due to increased enterprise adoption of mobile devices, including Smartphones, tablets and other handheld devices. Desktop outsourcing, however, is in a gradual decline that would be sharper were it not for uptake in Latin America, emerging Asia/ Pacific and Greater China.

ITO markets in emerging Asia/Pacific, Latin America and Greater China will all grow more than 13 percent in 2013 and 2014. Expansion by multinationals into these regions, new buyers of ITO that are themselves growing organizations, and fertile economic conditions all drive the positive outlook.

In North America, Gartner predicts that buyers will seek to transition more IT work to annuity-managed service relationships for cost takeout and more predictability in IT costs. This will keep ITO growing in the region through 2016. Economic austerity initiatives (fueled by a reluctance to hire or make large capital purchases) and enterprises pursuing asset-light IT strategies continue to push clients toward externally provided services.

"Historically, 'run the business' costs have been less impacted by economic challenges than has discretionary spending on new projects," said Britz. "Nevertheless, increased client adoption of pricing models that create volume variability is causing the ITO market to exhibit more cyclical patterns. This shift will continue as clients seek to reduce the nearly two-thirds of IT budgets devoted to operations, while shifting the expense from capital expenditure to operating expenditure through the consumption of ITO service lines."

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