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Outsourcing: Gartner Lowers Growth Forecast for the Year

By Dick Weisinger

IT spending on outsourcing is being pinched and Gartner has lowered their forecast for growth in IT outsourcing to just 2.88 percent for 2013, bringing the total spend on outsourcing in 2013 to $288 billion.

Bryan Britz, Gartner Research Vice President, said that “we continue to see overall market growth being constrained by near-term market factors, such as evolving ITO delivery models, economic, political and labor conditions, and service provider financial performance.  Mature Asia/Pacific and Western Europe are the regions where the outlook is most tempered, partly due to currency but also reflective of our view that 2013 is likely to be similar to 2012 in these regions.”

The main outsourcing areas that are seeing growth are cloud and data centers, driven primarily by small and mid-sized businesses adopting IaaS infrastructures.  Emerging markets are where the largest growth is being seen:  Asia-Pacific, Latin America and Greater China, where growth rates as high as 13 percent are being forecast in 2013 and 2014.

A separate report by the Information Services Group found that hundreds of global outsourcing contracts are expected to expire in 2013 — contracts worth about $21.2 billion — and about 75 percent of that was IT outsourcing.
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