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UAE's outsourced IT services will reach Dh626m by 2010

DUBAI — The outsourced IT services market in the UAE will reach Dh626.2 million ($170.5 million) by 2010 from Dh298.5 million ($81.27 million) in 2006, according to the global provider of market intelligence, International Data Corporation (IDC).

IDC has also been quoted by UAE systems integrator Raqmiyat as saying that outsourcing will account for 22.4 per cent of the local IT market's revenue by 2010 from 15.3 per cent in 2005.

These prompted Raqmiyat to position itself to capture a substantial share of the market, saying it has already completed a number of outsourcing projects for various regional and international banks in Dubai for this purpose.

Raqmiyat also planned to offer key outsourcing services on hosting and infrastructure, information systems, software applications, network and desktop management to companies here and the neighbouring countries, it said in a statement yesterday.

Tapas Roy, CEO of Raqmiyat, said that increasing operating costs, the need for flexibility in managing the resources and customer satisfaction and the reduction in cycle times would drive UAE companies to take advantage of outsourcing services to remain competitive.

"The increase in outsourcing is an inevitable development considering the rapid growth of businesses in the UAE, and with companies wanting to stay ahead of the competition, one of the most efficient ways to achieve this is to focus on quality internal resources and outsource non-core resources to capable partner," he said. Raqmiyat's support services provide employees of regional and international banks a single point of contact and end-to-end support for the IT infrastructure and desktop applications, the statement said.

The company said the UAE's IT market has been experiencing tremendous growth since 2005, with industry services accounting for Dh1.52 billion ($413.73 million). Meanwhile, the global outsourcing market will grow 8.1 per cent this year, according to Gartner, a global IT and research company. "In 2008, we expect to see some early adopters of multi-sourcing to consolidate around fewer providers to reduce their service integration costs and harvest the benefits of better relationship management with fewer strategic suppliers," said Kurt Potter, research director at Gartner.

But Gartner stressed in a statement from the US that publicly reported IT outsourcing (ITO) and business process outsourcing (BPO) contract values had declined 50 per cent in 2007.