Services Market Growing Rapidly

By Greg McNevin

May 19, 2008: The analysts at IDC are predicting strong growth in the services arena, tipping the market to top US$965 (AU$1,016) billion by 2012, and becoming a trillion dollar market soon after.

IDC forecasts that companies and government agencies will spend more than US$746 (AU$785) billion on external services in 2008, which represents a growth rate of 6.8 percent over 2007.

It says that even in the face of the currently weak U.S. economy, market forces are driving enterprises to service, while increased use of new and disruptive delivery options such as hosting, SaaS, and utility computing, is encouraging service provides and outsourcers in particular to focus on these areas.

“In these tough economic times, service vendors are faced with both new and old challenges,” said Marianne Hedin, program manager for Worldwide Services and SOA: The Services Opportunity research services. “The worldwide services competitive landscape keeps intensifying with many new entrants with new business and pricing models as well as the strengthened capabilities of up-and-coming players that are extending their reach into new markets.

“This is a time for service vendors to aggressively review their portfolio of offerings, account targets, investment strategies, business processes, and delivery practices.”

Comment on this story