Mumbai: The forecast for the IT services industry in 2003 is only slightly better than this year, according to Dataquest Inc., a unit of Gartner, Inc, which tracks the information technology industry. Worldwide IT services revenue is likely to reach $556.8 billion in 2002, which is merely 2.8 percent more than the revenue of $541.9 billion in 2001. In 2003, worldwide revenue is projected to reach $591.4 billion, up 6.2 percent from 2002. A Dataquest press release said process management remains the highest-growing IT services segment, in the short term and long term. Hardware maintenance and support maintenance has the slowest growth. "Outsourcing of both IT management and process management will continue to grow faster than consulting services and development and integration services," said Kathryn Hale, principal analyst for Gartner Dataquest's IT Services group. "This faster growth will result from vendors selling outsourcing services that enable buyers to both reduce their costs and improve their IT infrastructure." Gartner Dataquest analysts said there are three factors that influence users' spending the most on IT services:
- Decision makers' confidence in the value of IT and in the return on their investment
- The pace at which IT vendors generate demand by implementing compelling new technologies
- The speed at which users' aging technological assets require increasing maintenance and adaptation
"The first two factors have been undermined by continued weakness in the world economy and by the tenuous nature of the IT market's recovery," said Robert De Souza, industry analyst for Gartner Dataquest's IT Services group. "Decision makers' confidence in IT has been shaken. They have sought to cut costs by relying on their existing technological assets. This approach leaves little room for experimentation and innovation. As a result, buyers and vendors will find it even harder to decide which IT services to choose for the long term."
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