Gartner: Upturn for global IT services

Gartner: Upturn for global IT services

Taking into account the decline of the US dollar, the market for global IT services grew 2.2 per cent last year, but even that modest increase is a positive sign, according to analyst firm Gartner.

"It's a turn to optimism," company analyst, Kathryn Hale, said. "It is hard to drive any business without information technology, improving information technology."

The market grew 6.7 per cent to $US607.8 billion last year, up from $US569.6 billion in 2003.

IBM stills tops the market with a 7.6 per cent share of global sales in US dollars.

However, total growth in real terms in 2004 was 2.2 per cent because of the decline of the US, according to Hale, principal analyst for Gartner's worldwide IT services group.

"The growth in constant currencies was a modest upturn. In 2003, the real-term growth was 0 per cent." she said.

Gartner complemented its study of market growth in US dollars with constant currencies since 2003.

Outsourcing was the main growth driver for the market in 2003, according to Gartner.

"But it wasn't a one horse show in 2004," Hale said. "There was a modest resurgence in system integration during the year. It's fundamentally a better environment now."

Accenture, one of the top five companies in 2004, experienced equivalent increases in both its outsourcing and consulting segments, according to Gartner's report.

The increase of sales for IBM and HP was based on outsourcing both in 2003 and 2004.

In 2005, Gartner forecasts a continued improvement of 4.7 per cent compared with the year before: "There is still a lot of pent-up demand. So again, we see a slight upturn in real terms."

IBM led the way in 2004 with a 7.6 per cent global market share, followed by EDS (3.4 per cent), Fujitsu (2.8), HP (2.3), Accenture (2.3) and CSC (2.3).

The Gartner analysis was based on public statements from the companies in the market. The estimates are preliminary.

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