Downturn prompts biz to offload hardware

Outsourcing companies may be asked to take on more responsibility for IT hardware due to the economic pressures set to dog businesses in 2009.

According to IT services company Unisys, the next 12 months could see a growth in platform-as-a-service, where outsourcers run infrastructure as well as manage the services that companies need - a shift partly down to the continuing development of technologies such as virtualisation.

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The economic climate could also see organisations make IT costs part of their operational expenses rather than capital spending, which could result in them buying in more services rather than assets.

Unisys also predicts the further 'consumerisation' of IT means both businesses and outsourcers will need more creative ways of providing management and support - for example, allowing end users to choose what services they require for their role, rather than having them imposed by the IT department.

Despite the economic downturn, outsourcing experienced growth during 2008 according to figures released this week by sourcing data and advisory firm, TPI.

The total value of outsourcing contracts in 2008 - taking into account multi-year agreements - topped $90bn although the second half of the year was one of the weakest six months for larger new deals on record, according to TPI.

The company also found that during the first half of the year, 12 megadeals - contracts worth more than $1bn - were signed compared to just three in the second half.

In contrast, TPI found there was a 12 per cent increase in the number of contracts under the value of $1bn during 2008, in part due to contracts being shorter in length.

According to Anthony Miller, managing partner at research company TechMarketView, the move away from megadeals won't be good for smaller outsourcers.

"It seems pretty clear that large enterprises have all but lost their appetite for major outsourcing deals, instead breaking them down into smaller pieces with, we assume, quicker ROI. It doesn't take a rocket scientist to realise, then, that the big boys in the sector, like IBM, Accenture, HP/EDS, CSC, et al are going to have graze further afield for the next meal, and this will not be good news for the tier two players," he said in a research note.