12 Jan 2016

Singapore, January 13, 2016 – In IDC's recently published research titled "Analysis of IT and Cloud Services Deals Signed in Asia/Pacific (excluding Japan) Region" (AP40351815 ), IDC reports that an analysis of the IT services deals signed in APeJ shows Cloud-related services deals grew to $2.0 billion in the 3Q14-2Q15 cycle at 43% 5-year compound annual growth rate (CAGR). This report focuses its analysis on the impact of third platform technology adoption on the services market.

"Enterprises in the region have ramped up the transformation of their products, services and business processes to interact more efficiently with their customers, suppliers and other important stakeholders through digital transformation. These enterprises are embracing 3^rd platform technologies - especially mobility and analytics - with cloud being the underlying services delivery platform", says Sherrel Roche , IT Services Senior Market Analyst, IDC Asia Pacific.

According to IDC, the pressure on top management to increase their profits while continuing to decrease costs, combined with the proliferation of 3^rd platform and digital technologies, introduced new and substantial challenges for businesses across the IT Services market in the APeJ region. Moreover, the combination of a turbulent economy, the growth of local and pure-play cloud services providers and the continued pressure on traditional services providers to strengthen their consulting and industry-specific solutions are changing the way IT services are delivered.

The research revealed that the adoption of cloud-enabled digital transformation, analytics, and mobility applications are transforming the way IT services are being delivered. Enterprises are transitioning their workloads from traditional IT outsourcing services to cloud models, leading to continued price pressure within existing contracts as customers opt for hybrid IT services consumption model.

"A very interesting sub-trend visible in the IT services deal space is that enterprises are increasingly looking at strategic consulting, management advisory and management consulting services as they look to integrate 3rd platform technologies into their business strategy for innovation and competitive differentiation”, says Pushkaraksh Shanbhag , Senior Research Manager for IT Services at IDC Asia Pacific.

“IT Service Providers who are able to build out business consulting capabilities to accompany their evolving technology services offerings will benefit greatly from this trend”, adds Mr. Shanbhag.

To prepare for a cloud enabled future, IDC recommends that IT services providers must focus on strengthening their cloud professional services capabilities, and build capability to leverage cloud to deliver existing services, integrate legacy IT environments with cloud and build capabilities to manage the hybrid environment for their customers.

IDC’s research on Analysis of IT and Cloud Services Deals Signed in Asia/Pacific (excluding Japan) Region leverages the IDC BuyerPulse Services Deals Database, which currently has more than 58,000 contacts. This research answers questions pertaining to where the spending in IT services is occurring and cloud services deals (by geography, IT services market segments, deal sizes and industries), which vendors are winning deals, and where are the key opportunities lying in the next 12-24 months (FY 2016-2017).