ISG Index EMEA Sourcing Market Powered by ITO in Q3

Nachrichtenquelle: globenewswire
21.10.2020, 10:00  |  119   |   |   

Managed Services up 10% over prior year, on 36% growth in ITO

IaaS up 16%, as enterprises continue to shift work to the cloud

Combined market up 9% on soft compare with 2019, flat sequentially with Q2

UK produces stand-out quarter, with managed services ACV of €877 million (£794 million)

LONDON, Oct. 21, 2020 (GLOBE NEWSWIRE) -- The Europe, Middle East and Africa (EMEA) sourcing market was powered by strong demand for IT outsourcing (ITO) in the third quarter, with the U.K. producing particularly strong results, according to the latest state-of-the-industry report from Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

The EMEA ISG Index, which measures commercial outsourcing contracts with annual contract value (ACV) of €5 million (£4 million) or more, shows ACV for traditional managed services rose 10 percent year on year, to €2.2 billion (£2.0 billion), with ITO up 36 percent, to €1.8 billion (£1.6 billion). The U.K. alone contributed €877 million (£794 million) of managed services ACV in the quarter, up 60 percent over the prior year, with ITO doubling and business process outsourcing (BPO) up by double-digits.

The region’s double-digit growth in managed services ACV came despite a 40 percent slump in BPO, to €420 million (£381million), from the prior year, although quarter over quarter, BPO was up 25 percent.

Cloud-based services (as-a-service), meanwhile, advanced 9 percent year over year, to €1.7 billion (£1.5 billion), on the strength of infrastructure-as-a-service (IaaS), which rose 16 percent, to €1.2 billion (£1.1 billion). The software-as-a-service (SaaS) sector, however, declined 7 percent, to €431 million (£391 million) – its lowest quarterly ACV total in almost three years.

EMEA’s combined market ACV (including both as-a-service and managed services) climbed 9 percent year on year, to €3.9 billion (£3.5 billion), albeit in comparison with a weak third quarter last year. Sequentially, EMEA’s combined market ACV was down marginally from the second quarter.

“The EMEA managed services market was supported by robust deal activity this quarter, with the number of contracts up more than 20 percent over last year and the prior quarter,” said Steve Hall, partner and president, ISG EMEA. “However, following a general pattern we’ve seen in other regions, 85 percent of the deals were under €17 million (£15 million), with only 10 contracts in the entire region valued at over €34 million (£31 million).

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ISG Index EMEA Sourcing Market Powered by ITO in Q3 Managed Services up 10% over prior year, on 36% growth in ITO IaaS up 16%, as enterprises continue to shift work to the cloud Combined market up 9% on soft compare with 2019, flat sequentially with Q2 UK produces stand-out quarter, with managed …

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