07/07-05   -   Pressemeldinger

Shifting Demand Pattern Spurs Growth in Norwegian IT Services Market, Says IDC

The Norwegian IT services market recovered in 2004 and there is now a definite change in the underlying driving forces behind the demand, according to a new IDC study on the Norwegian IT services market. In past years, demand has been focused on cost cutting and rationalization, with little attention paid to forward-looking investment in new markets and products. This changed during autumn 2004 and there is now demand for new projects aimed at winning market share.

"Without doubt, the sentiment in the market has changed," said Nils Molin, senior analyst, IT Services Research, IDC Nordic. This, he added, has affected the market for consultancy services for the better and for the first time for many years there is now growth in the market.

Outsourcing services surged, with large deals being closed in the first half of 2004, while there was a more general demand for consulting services in the second half of the year. Cost and rationalization are still important in outsourcing deals, but flexibility and predictable costs are becoming more common driving forces in the market. Price pressure has continued in outsourcing and vendors have been forced to aggressively reduce costs to meet customer demand for lower prices. This has been achieved for software and hardware through consolidation and standardization.

Offshore sourcing was virtually nonexistent in Norway in 2004, but this is expected to change dramatically in coming years. "Customers will continue to demand lower prices, and personnel is what remains when possibilities in hardware and software have been exploited. Companies exposed to global competition will be forced to lead the way, but domestic and government businesses will follow," Molin said.

The Norwegian IT services market grew by 2.7% in 2004, and IDC forecasts growth rates of 6% to 7% over the next five years.

The study, Norway IT Services 2005–2009 Forecast and 2004 Vendor Shares (Doc #NO560554M, June 2005), is available to purchase from www.idc.com or from your local IDC office.

For more information
Nils Molin
+46 (0)8 751 0415
nmolin@idc.com

About IDC
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