Information Technology Services

Information Technology Services

Brief Excerpt from Industry Overview Chapter:

Companies in this industry provide services such as software support, computer systems design, and data processing facilities management. Major US companies include Computer Sciences Corporation (CSC), Unisys, and the technology consulting arms of IBM and Hewlett-Packard. Large companies based outside the US include Fujitsu (Japan), T-Systems International (a subsidiary of Germany's Deutsche Telekom), and Cap Gemini (France).

Worldwide IT services spending is about $3.7 trillion annually, according to Gartner. Leading exporters of computer and technology services include India, the US, Israel, and China, according to the World Trade Organization.

The US information technology (IT) services industry includes about 100,000 companies with combined annual revenue of about $325 billion. The output of US computer and data processing services, an indicator of information technology services, is forecast to grow at a high rate in the next two years. Key drivers of growth include a heightened focus on data security and the proliferation of wireless devices.

COMPETITIVE LANDSCAPE

Demand for IT services is driven by rapid technological advances, but spending for these expensive products depends on the health of the US economy. The profitability of companies depends on offering technical expertise, innovative services, and effective marketing. Large companies have advantages in broad service offerings and global reach, which give them the ability to provide outsourcing services to big corporate customers. Small companies can compete effectively by specializing in market niches or by partnering with larger companies that want to broaden their mix...