Interest in IT outsourcing services rising during 2010

by John Lynes

by John Lynes

European businesses are set to spend more money on external IT services this year, a new report has claimed.

According to research consultancy Gartner, 53 per cent of companies based within the continent are planning to outsource additional IT functions, while 40 per cent will increase their expenditure.

The study found that more firms are planning on spending between 50 and 75 per cent of their budgets on third-party technology services.

Outsourcing also seems to be gaining in popularity among smaller businesses, with 14.7 per cent of firms with a budget smaller than 1 million (822,000) interested in managed hosting.

When asked the same question in 2009, just 6.1 per cent of respondents claimed they were looking to delegate IT functions externally.

To date in 2010, there have been 6.1 per cent more Software-as-a-Service deployments than last year, highlighting the growing popularity of managed IT services.

However, Gartner vice-president and analyst Claudio Da Rold commented that pressure on capital and IT operating expenditure is still strong.

He suggested that European businesses are turning to outsourcing as they expect providers to deliver further cost reductions.

"Organisations in Europe are expecting or are in need of growth, but they are also still highly cautious," Mr Da Rold added.

"Regardless of the future direction of the economy, European businesses and their service providers need to optimise their multi-sourced environments, while increasingly adopting industrialised IT services."

Last month, a separate Gartner report indicated that global IT spend is set to rise by 2.9 per cent to reach 1.5 trillion this year.

Earlier forecasts had pointed to 4.1 per cent growth, although fears over the state of the economic recovery caused this figure to be downgraded.

[Source] Software Outsourcing Blog Section: http://www.unisoftchina.com http://www.techomechina.com

Interest in IT outsourcing services rising during 2010

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