IDC presages 19% IT growth next year

Global consultancy firm IDC has predicted a 19 per cent growth for the Indian information technology sector in 2004 "" highest in the region among other developing and developed countries such as China, and Taiwan.

The firm has also predicted that the country will contribute heavily to the Asian growth in the sector.

IDC has said that although the debate about offshore service delivery is one of the high profile issues for the industry across Asia Pacific and globally and there is a strong backlash against this phenomenon in the developed markets primarily due to concerns about growing unemployment.

IDC believes that the offshore BPO sector in India and elsewhere will continue to grow very strongly.

"In fact, 2004 will be a watershed year in this respect. While there is always going to be pressure on governments and public sector to resist the temptations of going offshore, the fundamental principles of maximising shareholder value will drive private sector to lower cost alternatives sooner rather than later," the report said.

The report also predicts that there would be some key structural changes within the IT industry - a move away from proprietary architectures and an emerging business innovation focus.

In a market that is entering a new growth cycle, IDC believes that the strategies that IT vendors will employ and the choices that they will make in order to capture the imminent growth will be substantially different from the past.

In fact, 2004 will be a pivotal year and choices made this year will determine shifts in market shares over the next five years.

The report also mentions that 2004 will be the first year in which - on both the hardware and system software side - virtually all of the leading players will see standards-based products as the core of their future business, and not just a fast-growing product category.

IDC expects the Asia Pacific storage management software market to grow by more than 26 per cent in revenue next year and that the total capacity of disk storage systems deployed is expected to increase from 190,000 tera bytes (TB) in 2003 to 300,000 TB in 2004, a 54 per cent rise.

In 2004, on-line advertising will begin to be referred to as a mainstream advertising channel in Asia's leading ad markets. Total online ad revenues in the region (excluding Japan) are expected to grow by over 40 per cent to $ 637 million in 2004.

Search ads growth will continue to build up steam, as will other ad forms previously limited to only off-line media, such as classifieds, real estate ads, and job ads.