The Hindu Business Line : Asia-Pacific BPO market likely to touch $14 b by 2010

Predicting a moderate growth and adoption of business process outsourcing (BPO) within the local Asia-Pacific market, global IT research firm IDC has said that the BPO market is estimated to display a compounded annual growth rate (CAGR) of about 18 per cent to touch about $14 billion by 2010.

"Even though Asia-Pacific excluding Japan (APEJ) is a main centre for BPO, majority of the contracts will still be derived outside of the region, mainly from the United States and Western Europe. Local adoption will be more opportunistic," Mr Conrad Chang, IDC's Senior Market Analyst for Asia/Pacific BPO Services Research, said.

While processing services would continue as the dominant form of business outsourcing, more pilot BPO projects are expected to emerge in the pipeline, he said. The findings are a part of latest IDC report, `Asia/Pacific (Excluding Japan) Business Process Outsourcing 2006 - 2010 Forecast and Analysis'.

It may, however, be noted that IDC's research programme tracks BPO services that are consumed locally and not exported. Therefore, if a US company engages a BPO vendor in India for services delivered to the US, that is considered a BPO export, and not counted as part of the study.

Moderate growth

IDC report predicted moderate growth for the region from 2006 to 2010 saying much of Asia Pacific would remain at the developmental stages of BPO adoption during this period. "Over the past 12 months, companies such as Accenture, EDS, HP and IBM have opened massive BPO centres in China, India and the Philippines, largely for servicing the United States and Europe, and not Asia-Pacific. In the light of these investments, IDC remains confident in its BPO outlook for the region and predicts moderate growth and adoption. BPO in 2005 totalled $6 billion and this figure is forecast to rise to about $14 billion by 2010 at a compound annual growth rate (CAGR) of approximately 18," IDC said.