Research company IDC has predicted strong growth for IT outsourcing in the Asia-Pacific region but believes Australia and New Zealand will not be at the forefront.
The analyst predicts the outsourcing market to grow from $US4.7 billion in early 2001 to $US14 billion by 2006, achieving a compound annual growth rate of 24 per cent.
Of the three types of IT outsourcing identified - information systems (IS) outsourcing, network and desktop outsourcing, and applications outsourcing - it is the latter that IDC identifies as having the greatest market potential. Applications outsourcing is expected to achieve a compound annual growth rate of 51 per cent over the five-year forecast period.
IDC does not hold a great deal of hope for growth in Australia and New Zealand. Analyst Phil Hassey predicts A/NZ will lose its market dominance, falling from 52 to 30 per cent, while the greater China region is expected to grow from 15 to 26 per cent in the same period.
The tremendous growth in China and Korea creates some interesting possibilities for Australian service providers to expand their opportunities. Next week's ARN will discuss several examples of intuitive Australian IT companies making their mark in the Asian market.