KUALA LUMPUR, Aug 19 -- Asia Pacific, the world’s smallest outsourcing region by contact value, saw the industry’s largest decline in the second quarter, as managed services slumped in response to the COVID-19 pandemic.
This is according to the latest state-of-the-industry report from a leading global technology research and advisory firm, Information Services Group (ISG).
The ISG Index™, which measures commercial outsourcing contracts with annual contract value of US$5 million or more, found the region’s combined market – both managed services and cloud-based as-a-service – fell 24 per cent versus the prior year, to US$1.9 billion, on pandemic concerns as well as a difficult comparison with a record-high second quarter last year. (US$1 = RM4.178)
According to a statement, the market was down across the board, as managed services plummeted 47 per cent, to US$529 million, with a 42 per cent drop in IT outsourcing, to US$477 million, and 71 per cent tumble in business process outsourcing, to US$52 million.
The decline in as-a-service was less severe, down nine per cent versus last year, to US$1.4 billion. Within this segment, infrastructure-as-a-service was down seven per cent, to US$1.2 billion, while software-as-a-service dropped 23 per cent, to US$165 million.
ISG forecasts slight sequential growth for the combined global market in the third and fourth quarters of 2020. For the full year, it is projecting the managed services market will be down 7.5 per cent, slightly more than the seven per cent decline it forecasted for the first quarter of 2020.
More details at www.isg-one.com.
-- BERNAMA
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