Services Market Nears $570B - InformationWeek

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IT Leadership // IT Strategy

Services Market Nears $570B

Global PlayersFueled in part by the increasing availability of low-cost offshore-outsourcing services, worldwide sales of IT services grew 6.2% last year to $569 billion, according to a Gartner study issued last week. In another study, Global Insight found that spending on offshore software development and services grew at a compound yearly rate of 32% between 1998 and 2003, when sales reached $10 billion.

Software developed offshore costs 40% to 60% less than domestic development, encouraging more use of custom apps over packaged software, says Morgan Stanley analyst Armon Bartur. "Application development is becoming so low-cost that users can move away from off-the-shelf software."

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