XMG Study Shows Continuing Growth in Call Center Outsourcing
posted in Outsourcing News and Top Outsourcing deals |Source: callcenterinfo.tmcnet.com
The global outsourcing market for information technology, business process outsourcing (BPO) and call center services is expected to continue to grow over the next few years. This global market includes both onshore and offshore delivery of outsourcing services.
According to an independent forecast study conducted by information and communications technology research and advisory firm, XMG, these segments of the global outsourcing market will finish at $297 billion this year with an estimated growth rate of 19.3 percent and is expected to hit $450 billion by 2010.
The study focused mainly on the performance of the top Asian offshore countries, namely India, China, Malaysia and the Philippines. The study projected that India would have $34.1 billion in total revenue by yearend, at 29.5 percent compound annual growth rate (CAGR) and will obtain 11.5 percent share of the global market.
At the same time, China is estimated to have 4.4 percent share of the global market with 2007 total revenue figures forecasted to hit $13.1 billion while growing at 47.9 percent CAGR.
“While it is no surprise that India and China continue to lead amongst the offshore countries, our study also showed a noteworthy insight to those following the growth of other offshore countries in Asia,” Lauro Vives, XMG Founding President and Chief Analyst, said in a company statement. “The Philippines is experiencing an unprecedented growth rate of 62% CAGR and will surpass Malaysia in 2007.”
The XMG intelligence report shows the Philippine’s revenue growing at almost $4.1 billion to achieve 1.4 percent of the global market. Vives noted that this particular industry has far exceeded all analyst expectations.
By comparison, Malaysia’s revenue forecast by yearend is estimated at $3.6 billion to achieve 1.2 percent of the global market share. In 2006, Malaysia and the Philippines were neck to neck with 1.04 percent and 1.02 percent respectively of the share of the global revenue pie.
“Locators are turning to other countries where there is headroom for further growth and expansion,” added Vives. “This continues to show that the strategy for expanding offshore rests on the availability of manpower in that country.”
“Our competitor intelligence report shows that the typical profile of offshore locators, whether service providers or captives, is to have the foresight that they can grow anywhere from 60% to 90% year on year unabated over the next two to three years.”
The XMG study showed continued strong growth in the offshore markets as the industry continues to deal with the rising cost of operations and the continuing depreciation of the US dollar. The cost of operations in India and the Philippines is increasing due to wage rate hikes to retain employees and the rise in real estate prices.
