The Hindu Business Line : Competition hotting up in services market: IDC

FIRMS which demonstrate their ability to integrate technology, and business processes with an explicit measurement of cost savings would win the battle for growing BPO and transformational outsourcing opportunity, in the backdrop of a fiercely-competitive global IT and business services market, according to a report.

In its latest report that analyses and compares the top 20 services firms including Accenture, ACS, Atos Origin, BT Global Services and Capgemini, International Data Corporation (IDC) has said that new entrants would continue to put competitive pressure on major incumbents.

"Some of the most notable emerging players today are CGI Group, Dell Services, Infosys, LogicaCMG, TCS, and Wipro Technologies," IDC said.

Noting that the market for IT and business services continues to present both great opportunities and never-ending challenges, IDC said that the competitive market was heating up as services firms faced slower growth prospects, pressure to expand geographically, greater productivity expectations, the need for deeper business and industry expertise, and internal transformations to meet market needs.

"Competition in the services marketplace has never been so intense. With new entrants from offshore locations, new delivery models being developed, the convergence of software, hardware, and services, and ever more demanding customers, services firms are faced with a multitude of challenges," the study said.

IDC concluded that those firms which are able to anticipate the changes and execute on their vision, would stay on the top of the market.

"The services market is highly fragmented with the top 20 providers representing just over a third of the market opportunity in 2003. IDC expects that the top companies will become increasingly dominant as acquisitions continue to play an important part in their growth strategies. Meanwhile, Small and Medium Businesses (SMBs) will comprise a greater share of the purchasing market with demand for low cost and rapid implementations," it said.

The top 20 services players profiled include Accenture, ACS, Atos Origin, BT Global Services, Capgemini, CSC, Deloitte, Deutsche Telekom (T-Systems), EDS, Fujitsu, HP Services, Hitachi, Ltd, IBM Global Services, Lockheed Martin, NEC, Northrop Grumman, NTT, Siemens Business Services, SAIC, and Unisys.