Executive Briefings

Worldwide IT Services Revenue Grew 6 Percent in 2006

Worldwide IT services revenue totaled $672.3 billion in 2006, a 6.4 percent increase from 2005 revenue of $631.8 billion, according to Gartner, Inc.

"Core business process outsourcing (BPO) services had a strong showing in 2006," said Kathryn Hale, research vice president for Gartner's worldwide IT services group. "These process management services grew 8.6 percent worldwide, and several market leaders grew faster than the overall market. Still, development and integration services represent the backbone of IT services, accounting for 30 percent of the market in 2006."
Across all IT services, IBM continued to be the worldwide market leader, but its growth rate was below the industry average. EDS and Accenture were the only vendors in the top six that experienced revenue growth rates above the overall market average. Market share for 13 of the top 20 vendors dropped in 2006.

Company2006 RevenueMarket Share (%)
IBM48,2477.2
EDS21,2683.2
Fujitsu17,8872.7
Accenture17,2312.6
HP16,4422.4
CSC14,6822.2
Others536,60879.8
Total Market672,365


While global sourcing makes the location of a provider's headquarters increasingly less relevant, Gartner tracks this information for more than 400 vendors that collectively account for more than 70 percent of end-user spending worldwide. While India-based vendors' IT services revenue grew 33.3 percent in 2006, these companies earned only 3 percent of revenue tracked, while U.S.-based vendors earned 57 percent of that total. "Without significant acquisitions, it would take India-based vendors many years to reach even half the revenue of U.S.-based vendors," said Ms. Hale.

More information on the IT services market is available in the Gartner report "Market Share: IT Services Rankings Worldwide, 2006." The report is available on Gartner's Web site at
http://www.gartner.com

Worldwide IT services revenue totaled $672.3 billion in 2006, a 6.4 percent increase from 2005 revenue of $631.8 billion, according to Gartner, Inc.

"Core business process outsourcing (BPO) services had a strong showing in 2006," said Kathryn Hale, research vice president for Gartner's worldwide IT services group. "These process management services grew 8.6 percent worldwide, and several market leaders grew faster than the overall market. Still, development and integration services represent the backbone of IT services, accounting for 30 percent of the market in 2006."
Across all IT services, IBM continued to be the worldwide market leader, but its growth rate was below the industry average. EDS and Accenture were the only vendors in the top six that experienced revenue growth rates above the overall market average. Market share for 13 of the top 20 vendors dropped in 2006.

Company2006 RevenueMarket Share (%)
IBM48,2477.2
EDS21,2683.2
Fujitsu17,8872.7
Accenture17,2312.6
HP16,4422.4
CSC14,6822.2
Others536,60879.8
Total Market672,365


While global sourcing makes the location of a provider's headquarters increasingly less relevant, Gartner tracks this information for more than 400 vendors that collectively account for more than 70 percent of end-user spending worldwide. While India-based vendors' IT services revenue grew 33.3 percent in 2006, these companies earned only 3 percent of revenue tracked, while U.S.-based vendors earned 57 percent of that total. "Without significant acquisitions, it would take India-based vendors many years to reach even half the revenue of U.S.-based vendors," said Ms. Hale.

More information on the IT services market is available in the Gartner report "Market Share: IT Services Rankings Worldwide, 2006." The report is available on Gartner's Web site at
http://www.gartner.com