IT outsourcing to boom in 2000

[QQ]An extensive survey of over 5,000 heavyweight IT users has identified that outsourcing will be one of the most active sectors in 2000. The survey, by Butler Spectrum, also earmarks Oracle as the runaway database manufacturer of choice. Host and server manufacturers can expect a hard time over the next two years as demand declines sharply and the bell tolls for Apple which is left “virtually for dead” in the corporate world.[QQ] The report covers subjects such as expenditure, desktop usage, applications development, services and outsourcing and the Internet.[QQ] Author Graeme Philipson, said: “There will be a continued decline in hardware’s proportion of the total IT spend over the next year, from 23 percent of all spending to 21.4 percent. Most other areas will show a rise, especially software and services.”[QQ] The number of Intel-based servers will decline by about 35 percent, and the number of non-Intel based servers by a significantly smaller 10 percent.[QQ] However, the report reveals that there will be six-fold growth in the number of Network Computer “thin clients” over the next two years. Practically all of that number will be dumb terminal replacement. The growth in laptop usage will be much higher.[QQ] The services and outsourcing sector appears to remain one of the most active areas. The IT activities most likely to be outsourced are host/server maintenance, outsourced by over 85 percent of organisations. Network and PC maintenance are also burgeoning areas and IT training is currently outsourced by over 60 percent of organisations. No other activity is outsourced by more than 50 percent of organisations.[QQ] The survey also found that e-commerce activity only accounts for 1.3 percent of total transactions and 0.8 percent of revenues. However, these figures are expected to rise dramatically, reaching 20.8 percent and 14.5 percent respectively by the end of 2001.

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