May 4, 2010 – Worldwide IT services revenue declined 5.3 percent in 2009 to $763 billion, compared to $805 billion in 2008, according to a new report from Gartner, Inc.

Revenue declined for each of the five largest IT service providers, including IBM, HP, Fujitsu, Accenture and CSC, with the most significant drop, at 11.8 percent, experienced at Accenture.

The top 20 vendors, however, collectively gained slight ground over smaller competitors in 2009, increasing 0.2 percent and accounting for 37.5 percent of the market, according to the report.

IT service provider strategies shifted from aggressive sales or tactical revenue acquisition to revenue maintenance and cost management in 2009, says Kathryn Hale, research vice president for Gartner's worldwide IT services group. According to the report, “2009 was a year like no other before it for IT services providers,” she said.

That said, Hale expects 2010 to be a period of readjustment. “The discipline exercised in 2009 leaves the industry profitable and relatively nimble. But investors will expect to see revenue growth and managing those expectations, while maintaining margins will be more challenging than the comparatively unambiguous goals of 2009, a year in which expectations were modest.”

Click here to read “Lessons for IT Service Vendors: Get to Know Your Clients.”

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