BPO deals bring good times back for IT services

The western European IT services market, led by the UK, will return to growth in 2005 and reach £111bn in 2005, an increase of...

The western European IT services market, led by the UK, will return to growth in 2005 and reach £111bn in  2005, an increase of 3.5% over 2004, analyst firm Gartner has predicted.

The UK market will grow by 5.6% to £34.1bn in 2005 while the western European market will grow by an average of 4% until 2008, according to the firm.

In 2005, said Gartner, outsourcing would continue to outperform the overall IT services market, growing by 4.6%.

The fastest-growing segment within outsourcing will be business process outsourcing (BPO), with a  forecast growth rate of 6.6%

Financial services and the public sector are the two sectors with the most significant growth in specialised BPO offerings.

Nicole France, principal analyst in Gartner research, said, “Following a tough time in the IT services industry over the last four years, we are seeing concrete signs of market recovery in all segments, with overall market growth rates finally turning positive again.

“Despite consulting and systems integration services growing slowly, outsourcing agreements, as a means of purchasing  IT professional services, are underpinning accelerated overall growth across the entire European IT services industry."

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