IDC IT Survey Reveals Strong Trend for Communications Infrastructure Outsourcing

HostReview.com
Monday, November 29, 2004; 05:27 PM

Equant revealed key findings of IDC (www.idc.com ) research on IT outsourcing trends during its "Strategic Sourcing for Communications" event held today in Geneva and attended by senior executives from top multinational companies.

Commissioned by Equant, the research was conducted during Q3 2004 in Europe, North America and the Far East among CIOs and CFOs from more than 300 of the world's largest multinational corporations.

The IDC research reveals that 64 percent of CIOs and 77 percent of CFOs are positive about selective IT outsourcing, but over three-quarters of board-level IT and finance directors would not want to outsource their IT in its entirety.

When selecting an outsourcing provider for the network/communications infrastructure CIOs rate telecommunications specialists highest (54 percent), followed by generalist IT companies (32 percent) and then local outsourcing providers (14 percent). They typically entrust their communications infrastructure to a specialist in order to drive down costs and focus on core business functions.

Of the organizations polled in the research, 72 percent had already outsourced certain elements of their IT. The most common benefit, cited by a quarter of the CIOs interviewed was the ability to focus more on core business functions.

"When it comes to IT infrastructure and services, this research indicates that most multinationals are less enthusiastic about IT outsourcing mega contracts," said Duncan Brown, Consulting director at IDC.

"We see an increasing enthusiasm for communications infrastructure outsourcing as part of this selective IT sourcing approach," said Michel Picaud, senior vice president, Equant Solutions and Services. "This trend is reflected by a surge in demand for Equant's outsourcing services from multinational customers. Our outsourcing business revenues have more than doubled in the first half of 2004. Our customers, such as JTI and Zurich Financial Services, are satisfied and we are progressively increasing the scope of our business relations."

A complete summary of the research is available by contacting Equant. In addition to the findings outlined in this release, the full report compares and contrasts the perspectives of the CIO and CFO to IT outsourcing.

IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies.