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Services revenue dips through recessionary year

Simon Quicke

Services revenue has been hit by the recession with revenues dipping worldwide last year and the consequences are still being felt in the market.

According to a report into the global services market from Gartner revenue globally last year reached $763bn, a 5.3% decline on 2008.

All of the five largest services providers saw declines but HP and Accenture were hardest hit by the downturn.

Indian vendors also took a hit, with the country responsible for a rapid growth in outsourcing and services, only recording growth of 3.6% down from 15.4% in 2008.

"2010 will be a year of focused readjustment for IT services providers," said Kathryn Hale, research vice president for Gartner's worldwide IT services group.

"[Last year] was a year like no other before it for IT services providers," added Hale "Their priorities changed and their business focus rushed from aggressive sales or tactical revenue acquisition, to strategies designed to simply maintain revenue levels, keep a handle on costs and manage profitability."

She said that investors in the sector expected to see revenue growth this year and providers would need to deliver those as well as maintaining margins in a market that remains a challenge.


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