Asia Pacifics IT Business Services Market set a Record High for 2021

CIO Review APAC | Wednesday, March 23, 2022

Combined market grew at the fastest annual rate ever – 44 percent – to a record $16.1 billion.

FREMONT, CA: According to the latest state-of-the-industry report from Information Services Group, a leading global technology research and advisory firm, Asia Pacific's IT and business services market grew at its fastest rate ever. It achieved an all-time high in 2021, even though the demand for cloud-based infrastructure services slowed down in the fourth quarter.

The full-year annual contract value for the combined market which includes both SaaS and managed services reached a record USD 16.1 billion, up 44 percent, the region's fastest annual growth rate since Information Services Group began tracking the combined market in 2014. For the full year, XaaS spending increased by 47 percent to a record USD 13.2 billion, with infrastructure-as-a-service (IaaS) spending increasing by 47.5 percent to USD 11.7 billion and software-as-a-service (SaaS) spending increasing by 40 percent to USD 1.5 billion, both new records.

The combined market ACV in the fourth quarter of 2021 was USD 4.4 billion, up 31 percent from the previous year period, but only one percent sequentially from the third quarter of 2021, owing to a decrease in IaaS expenditure. Overall, the XaaS market increased by 28 percent to USD 3.4 billion, but was down 7 percent sequentially, as IaaS fell 8 percent quarter over quarter and SaaS fell 2 percent. In comparison to the previous year, IaaS increased by 25 percent to USD 3.0 billion, and SaaS increased by 51 percent to USD 393 million.

Meanwhile, managed services revenue increased by 43 percent year over year to USD 931 million, and by 50 percent year over year in the third quarter. ITO increased by 55 percent year over year to USD 741 million, representing a 70 percent increase over the third quarter of 2021. BPO increased by 10 percent to USD 190 million, but only by 2 percent over the previous quarter. In the fourth quarter, 61 managed services contracts were awarded, up 15 percent over the previous year.

 

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