Financial Daily from THE HINDU group of publications
Monday, Dec 06, 2004
Financial Daily from THE HINDU group of publications Monday, Dec 06, 2004 |
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Info-Tech
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Trends Survey sees consolidation in web hosting, IT services sectors Moumita Bakshi
New Delhi , Dec. 5 ANTICIPATING a "significant evolution" of the web hosting and managed IT services market going forward, a Forrester survey has pointed towards a further industry consolidation and increased visibility for offshore Indian suppliers as key trends for 2005. "Recent research by Forrester points to positive - if modest - growth for Web hosting and managed IT services, at both the enterprise and Small and Medium Business (SMB) levels. "Although recent industry speculation of a new inflection point is overblown, any rise in customer demand is good news to suppliers in this once beleaguered segment as it heads into 2005," the report titled - `Trends 2005: Web Hosting and Managed IT services' said. Furthermore, the balance between insourcing and outsourcing is tipping again toward the latter, Forrester said. "Expect to see further industry consolidation, an expanded range of virtual services, increased visibility for offshore Indian suppliers, and blurring between IT-centric and network-centric managed service providers (MSPs) in 2005," it predicted. Surveys of customer buying behaviour points to an increased consumption of managed IT and network services, including Web hosting which has become less about pure Internet hosting and more of a general-purpose capability addressing various aspects of IT operations. As such, the opportunities for customers - as well as the providers that serve them - are broadening. Amongst the key drivers changing the landscape was the fact that customers had begun to turn outside for help once again. "The collapse of the hosting segment in 2001-2002, together with excess in-house IT capacity, led many customers to refocus internally. However, a combination of more ambitious eBusiness strategies, expanded disaster recovery programs, and the desire for expanded infrastructure management capabilities amid continuing resource constraints are leading enterprise customers to turn to external service providers once again," it said. In addition, improved market stability had mitigated viability fears and suppliers were expanding offerings to yield complementary revenue streams. It said that the market for Web hosting and managed IT services was poised for significant evolution which would ride on trends such as blurring of the demarcation between network and IT oriented managed services and merging of offshore infrastructure management and IT managed services.
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