The Hindu : BPO market to reach $1 trillion by 2006: Study

Online edition of India's National Newspaper
Wednesday, Mar 24, 2004

Business

Business

BPO market to reach $1 trillion by 2006: Study

By Our Special Correspondent

NEW DELHI, MARCH 23. The Business Process Outsourcing market is expected to reach about $1 trillion by 2006, registering an increase at a compounded annual growth rate (CAGR) of 9 per cent.

Bringing this out, a joint study undertaken by the BPO Steering Committee of the Associated Chambers of Commerce and Industry of India (Asscocham) and the International Data Corporation (IDC) also notes that the Americas account for about 60 per cent of the spending on the worldwide BPO market.

This is largely driven by the prosperity to outsource, cut costs and focus on core competencies. Although this trend is likely to continue during 2004-06, the Americas are likely to experience the slowest year-on-year growth in spending on the BPO market, while their Asia-Pacific counterparts are likely to see robust growth annually during this period. In fact this region is likely to be the fastest growing region in the world in terms of spending on the BPO market.

The EMEA region is however expected to witness a steady growth in its IT spending during 2004-06, with the U.K. leading the way. Cultural differences, stringent regulatory norms and overall resistance to adopt new services are some of the reasons that are likely to impact this steady growth.

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