Introduction

Application Outsourcing (AO) is undergoing tremendous changes. The traditional value drivers of labor arbitrage, process efficiency, and standardization are unable to provide the next level of value in AO engagements. Buyers are facing multiple challenges in their portfolio (e.g., rapidly declining productivity) and service providers are unable to respond to these issues. As a result of this, the market is witnessing significant number of service providers losing their existing AO engagements.

Everest Group’s annual research on application services provides fact-based perspectives on buyer adoption by geography, industry, and revenue size. It analyzes major trends that are shaping the applications market and the outlook for the next year. It also sizes the IT services market in terms of application outsourcing and consulting services.

Scope

• IT service market size (split across applications, consulting, infrastructure service, geography, and industry verticals)
• Market share of leading IT service providers in applications, consulting, and infrastructure service
• AO buyer adoption trends across geography, industry verticals, and revenue size
• Key trends shaping the AO market (cloud, mobility, anti-incumbency, and productivity)
• Outlook for 2014

Content

This annual research deep dives into the application outsourcing landscape. It provides data-driven facts and perspectives on the overall market. The research covers AO adoption trends, demand drivers, next-generation services such as mobility, analytics, and cloud. The research analyzes buyer challenges, trends shaping the market, and also provides an outlook for 2014 for the broader IT as well as AO market.

For example, the section on “AO Overview” analyzes the following:

• Deal trends (new vs. renewals)
• Deal size and duration
• Scope of services (e.g., application development, maintenance, and consulting)
• Pricing trends
• Delivery locations