PracticeConsultingBPOs control IT market

BPOs control IT market

IT companies' revenue growth will not exceed 10% in the next four years and business process outsourcers now control the IT market, according to Richard Holway, director of market analysis company Ovum Holway.

He also said cost cutting and restructuring measures would continue in the IT sector through 2002, although earnings would rebound in 2003.

Holway spoke at the fifth Deloitte & Touche Quarterly Review, held in association with techMARK. “While IT power began with the hardware vendors in the ’60s and ’70s and then transferred to software vendors in the ’80s and ’90s, it now rests largely with the BPOs – those who control the interface with the end-user, the purse strings and the technology to be used.” he said.

William Touche, partner in Deloitte & Touche’s technology, media and telecommunications group, believes that IT companies are no longer hoping for a return to late ’90s valuations, and those that do well will be based around sustained revenue models and focus on quality throughout the organisation.

The review of 2001 found that while the techMARK 100 index increased by 28% and the techMARK All Share by 11% for Q42001, both indices have fallen by about 30% since their launch.

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