Global IT services revenue hits $793B

Summary:Spending in software support sees highest growth rate of 6.6 percent in overall IT services industry last year, in which IBM maintains pole position with 7.1 percent market share, reveals Gartner report.

The IT services market bounced back from the effects of the global recession to record a 3.1 percent increase in revenue to US$793 billion last year, from US$769 billion in 2009, according to a new report from Gartner.

Released Thursday, the study revealed that the majority of end-user spending in the market went toward software support, pushing this sector to clock the highest growth at 6.6 percent. Process management and hardware support saw weaker results where both segments grew at 1 percent less than projected.

Consulting, development and integration services performed slightly better than expected as organizations that held back on investments began investing again last year, particularly in the second half of 2010, Gartner said.

"There is little doubt that the effects of the global recession of 2008 and 2009 are still very much being felt, but the market for IT services bounced back in 2010 after a 5.1 percent revenue decline in 2009," Kathryn Hale, Gartner's research vice president, said in the report.

Collectively, India-based IT services vendors grew 18.9 percent--well above the industry average of 3.1 percent--and increased their market share to 5.5 percent last year, compared to 4.8 percent in 2009.

According to Gartner's senior research analyst, Dean Blackmore, acquisitions affected over 10 percent of total revenue in the IT services market, in which no service provider has more than 7 percent market share. More than 300 vendors were monitored for the report, he noted.

Among these vendors, IBM retained its pole position and increased its IT services revenue by 2.6 percent to US$56.4 billion. It held 7.1 percent share of the overall market.

Hewlett Packard, with a 4.5 percent market share, ranked second and saw the weakest revenue growth among the Top 5 vendors, growing its IT services revenue by 0.3 percent to US$35.3 billion last year. Fujitsu was placed third with a 3 percent market share, and grew its revenue by 3.5 percent to US$24.1 billion.

Accenture ranked fourth, growing its revenue by 6.1 percent to US$22.2 billion, while CSC rounded up the Top 5 list with a 0.6 percent revenue growth to US$16.1 billion.

Topics: Hardware, Software

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