IDC: Australia to enjoy world-beating growth in IT services

IT services industry to grow by 4 per cent from 2009 to 2013 thanks to cost-cutting

The Australian IT services industry will defy world trends and grow by 4 per cent over the next five years, according to IDC experts.

The predictions were made as part of an IDC report titled, Australia IT Services Market 2009-2013 Forecast and Analysis, which said companies were continuing to spend on ICT and the market would grow at a five year compound annual growth rate (CAGR) of 4 per cent from 2009-2013.

IDC senior analyst in IT services, Marina Beale, said the world-beating growth was strong for a mature market and came as a result of optimisation and cost-cutting programs.

“We’re seeing a lot of projects around unified communications so as part of keeping costs down people are using technology to rationalise on travel costs,” she said.

“The managed service space and remote monitoring of systems and infrastructure is a growth area as well. It’ll be a mix of delivery models as they suit the companies.”

Beale said despite hopes Federal Government spending would pull the market up, the public service is mostly cutting down.

“The Federal Government in Canberra has been very tight with how it’s been spending and local players will say they’ve suffered from Canberra having tightening the purse strings at this time," she said.

“Going forward we would hope they will change and we expect a change but they’ve been more careful in the last six months.”

Her comments are in line with analyst expectations that $54.5 million of savings resulting from the Gershon review will be up for reinvestment by Government agencies.

Beale also said outsourcing has enjoyed a boost in the current economic climate, with some companies becoming less worried about the ramifications of shifting jobs abroad.

“We still see a healthy growth for outsourcing, it’s another way of keeping costs down. People are less conservative about putting it overseas."

But she warned the global economy was still in a state of flux and could change.

“If there was a complete collapse then, of course, we’d need to review things,” she said. “If you’ve got great infrastructure solutions and a diverse range of customers then you could probably withstand it and a lot of companies have shown that.”