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Global outsourcing weakens as contract values and numbers decline
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Global outsourcing weakens as contract values and numbers decline
New Delhi: The quarter ended September 2008 saw a decline in the value and numbers of outsourcing contracts inked, thanks to the weakness of financial service market and the ongoing recessionary trend. During the quarter-3, outsourcing contracts worth $ 14.4 billion in Total Contract Value (TCV) were signed, there is a 50 percent drop compared to the previous quarter. The number of outsourcing contracts stood at 128, with a 22 percent decline over the last quarter.
Though the third quarter is traditionally considered as the weakest quarter of the year, this year`s third quarter saw a decline which was lower than historical average by almost 20 percent, according to the TPI Index, TPI is a sour
cing data and advisory firm.
Siddharth A. Pai, Partner & Managing Director, TPI India said, "The share of Indian service providers in the industry-wide contracts remained almost steady at 11 per cent. Overall, the Q3 2008 has been the weakest in 10 years."
The quarter didn`t witness many mega contracts in which the Annualised Contracts Value (ACV) is over $100 million, apart from only one mega deal with TCV over $1 billion.
Performance in Europe, the Middle East and Africa declined significantly in TCV levels compared with recent quarters and there was a dramatic drop in Information Technology outsourcing contract value compared with the first two quarters. However, despite the softness in Q3, the 2008 year-to-date numbers and value of outsourcing contracts exceed metrics of 2007.
Anticipating a strong fourth quarter award values, TPI said the current crisis is likely to introduce softness in outsourcing contract awards entering 2009.
Source:
http://www.siliconindia.com/shownews/48751
Though the third quarter is traditionally considered as the weakest quarter of the year, this year`s third quarter saw a decline which was lower than historical average by almost 20 percent, according to the TPI Index, TPI is a sour
cing data and advisory firm.
Siddharth A. Pai, Partner & Managing Director, TPI India said, "The share of Indian service providers in the industry-wide contracts remained almost steady at 11 per cent. Overall, the Q3 2008 has been the weakest in 10 years."
The quarter didn`t witness many mega contracts in which the Annualised Contracts Value (ACV) is over $100 million, apart from only one mega deal with TCV over $1 billion.
Performance in Europe, the Middle East and Africa declined significantly in TCV levels compared with recent quarters and there was a dramatic drop in Information Technology outsourcing contract value compared with the first two quarters. However, despite the softness in Q3, the 2008 year-to-date numbers and value of outsourcing contracts exceed metrics of 2007.
Anticipating a strong fourth quarter award values, TPI said the current crisis is likely to introduce softness in outsourcing contract awards entering 2009.
Source:
http://www.siliconindia.com/shownews/48751
