Asia Pacific expecting IT services bonanza

By Simon Burns

Apr 5 2008 11:12AM

Businesses in Asia will spend almost $56bn annually on IT services within three years, new research predicts..

Forecasts from US-based Springboard Research include the IT services market in China and India, but not Japan.

India will be the fastest growing country with an average yearly growth rate of 18.6 per cent, according to the company's predictions.

However, Springboard rates China as the most attractive market overall on the basis of growth opportunities.

"For India and China, local capabilities, offerings and presence is just the start of a list of essential requirements for success," said Phil Hassey, vice president of services research at Springboard.

"On the other hand, existing relationships, marquee clients and strong partnerships can provide capabilities for expansion in markets such as Hong Kong and New Zealand which have relatively limited opportunities."

The fastest growing IT service is expected to be application hosting with a growth rate of 19.5 per cent.

However, the largest single sector will continue to be enterprise application integration. Chinese firms' reluctance to outsource IT is hindering the regional growth of such services.

"The Asia Pacific IT services market is arguably the global leader in terms of growth, supplemented with a mix of mature and emerging markets," said Hassey.

"The markets of interest are not just the top four - China, India, Australia and Korea - but emerging ones like Indonesia and Vietnam which will register significant growth."