Close
  • Latest News
  • Artificial Intelligence
  • Video
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
Read Down
Sign in
Close
Welcome!Log into your account
Forgot your password?
Read Down
Password recovery
Recover your password
Close
Search
Logo
Subscribe
Logo
  • Latest News
  • Artificial Intelligence
  • Video
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
More
    Subscribe
    Home IT Management
    • IT Management

    Report Predicts Rapid Growth of IT Offshoring

    Written by

    Deborah Rothberg
    Published January 12, 2007
    Share
    Facebook
    Twitter
    Linkedin

      eWEEK content and product recommendations are editorially independent. We may make money when you click on links to our partners. Learn More.

      Up dramatically from prior quarters, 72 percent of CIOs reported that they intended to increase their spending with external service providers in 2007, according to the quarterly CIO User Survey released by Merrill Lynch on Jan. 9.

      Up from 46 percent in the third quarter of 2006 and 58 percent 12 months earlier, as spending on IT services represents an increasing part of overall IT budgets, it is likely that offshore outsourcing will also be on the rise.

      Spending on internal IT staff, however, still remains the largest part of IT budgets, according to the report. Still, it has come down from 42 percent in 2005 to 37 percent in 2006.

      CIOs expected an increase of their budgets for consulting and integration, up to 11 percent in Q4 2006 from 9 percent in Q3. CIOs top choices of vendors for projects included ACN, IBM as well as Indian vendors for these types of projects. Systems integration remained the top IT spending priority for CIOs, with consulting holding the second place.

      CIOs indicated a substantial increase in the pricing for IT outsourcing in the report, up to 2.7 percent from 2.0 percent the previous quarter. A 2 percent increase in the allocation for offshore vendors was expected to increase to 2.8 percent, should pricing trends remain positive. In the previous four surveys, the allocation for offshore outsourcing had been only 1.1 percent.

      Despite the fact that projects with an offshore component decreased from 44 percent to 36 percent between the Q3 and Q4 2006 reports, the report predicted that offshoring of IT service will continue to grow rapidly, noting that demand remains strong and expectations of cost savings are high.

      Indian vendors such as Infosys and Satyam continue to stand to benefit the most from this expansion.

      IT spending as a whole is expected to grow 4.2 percent in 2007, according to the report. IT spending finished 2006 up 3.4 percent, but slower than the increase of 4.4 percent in 2005, however CIOs at that time had expected growth of only 3 percent, the study notes, leaving the 3.4 percent final number more on-target.

      Check out eWEEK.coms for the latest news, reviews and analysis on IT management from CIOInsight.com.

      Deborah Rothberg
      Deborah Rothberg

      Get the Free Newsletter!

      Subscribe to Daily Tech Insider for top news, trends & analysis

      Get the Free Newsletter!

      Subscribe to Daily Tech Insider for top news, trends & analysis

      MOST POPULAR ARTICLES

      Artificial Intelligence

      9 Best AI 3D Generators You Need...

      Sam Rinko - June 25, 2024 0
      AI 3D Generators are powerful tools for many different industries. Discover the best AI 3D Generators, and learn which is best for your specific use case.
      Read more
      Cloud

      RingCentral Expands Its Collaboration Platform

      Zeus Kerravala - November 22, 2023 0
      RingCentral adds AI-enabled contact center and hybrid event products to its suite of collaboration services.
      Read more
      Artificial Intelligence

      8 Best AI Data Analytics Software &...

      Aminu Abdullahi - January 18, 2024 0
      Learn the top AI data analytics software to use. Compare AI data analytics solutions & features to make the best choice for your business.
      Read more
      Latest News

      Zeus Kerravala on Networking: Multicloud, 5G, and...

      James Maguire - December 16, 2022 0
      I spoke with Zeus Kerravala, industry analyst at ZK Research, about the rapid changes in enterprise networking, as tech advances and digital transformation prompt...
      Read more
      Video

      Datadog President Amit Agarwal on Trends in...

      James Maguire - November 11, 2022 0
      I spoke with Amit Agarwal, President of Datadog, about infrastructure observability, from current trends to key challenges to the future of this rapidly growing...
      Read more
      Logo

      eWeek has the latest technology news and analysis, buying guides, and product reviews for IT professionals and technology buyers. The site’s focus is on innovative solutions and covering in-depth technical content. eWeek stays on the cutting edge of technology news and IT trends through interviews and expert analysis. Gain insight from top innovators and thought leaders in the fields of IT, business, enterprise software, startups, and more.

      Facebook
      Linkedin
      RSS
      Twitter
      Youtube

      Advertisers

      Advertise with TechnologyAdvice on eWeek and our other IT-focused platforms.

      Advertise with Us

      Menu

      • About eWeek
      • Subscribe to our Newsletter
      • Latest News

      Our Brands

      • Privacy Policy
      • Terms
      • About
      • Contact
      • Advertise
      • Sitemap
      • California – Do Not Sell My Information

      Property of TechnologyAdvice.
      © 2024 TechnologyAdvice. All Rights Reserved

      Advertiser Disclosure: Some of the products that appear on this site are from companies from which TechnologyAdvice receives compensation. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. TechnologyAdvice does not include all companies or all types of products available in the marketplace.