IT Outsourcing - Ireland

Ireland

Revenue in the IT Outsourcing market is projected to reach US$1.64bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 8.54%, resulting in a market volume of US$2.47bn by 2029.
The average Spend per Employee in the IT Outsourcing market is projected to reach US$565.80 in 2024.
In global comparison, most revenue will be generated in the United States (US$197.30bn in 2024).

Key regions: Netherlands, United States, Japan, Germany, Italy

Definition:
The IT Outsourcing market refers to the external contracting of IT functions, services, or projects instead of relying on company-owned resources. By outsourcing IT tasks (e.g., to IT suppliers or software developers), enterprises are able to focus on their core functions and save internal resources and costs (e.g., office space, maintenance, and utilities). Thus, outsourcing teams becomes a viable cost resilience strategy in an environment where companies are looking to save money more than ever.

In an IT context, these activities include IT administration, IT application, and web hosting services. Non-IT-related outsourcing services are excluded.

Structure:

IT Outsourcing contains four distinct markets that are based on different services:

Administration Outsourcing refers to the market for services associated with the external sourcing of typical IT administration tasks such as hardware supply, setup, configuration, maintenance, security, and support.
Application Outsourcing refers to the market for all IT application services in a software production context, spanning from requirement assessments to concept and design of software applications.
Web Hosting includes all types of internet hosting services that allow companies or individuals to provide access to their web page via the World Wide Web.
Other IT Outsourcing refers to aggregated revenues of the types of IT outsourcing that are not specifically mentioned in the other IT Outsourcing markets, such as infrastructure outsourcing, network outsourcing, and managed services.

Additional Information:

The IT Outsourcing market comprises revenues, revenue change, average spend per employee, and revenues of the outsourcing types. Market values represent revenues that are generated by primary vendors either directly or through distribution channels at the manufacturer price level (excluding VAT). Reported market revenues include spending by enterprises (B2B) and governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed. Key players in the market include IBM, Accenture, Capgemini, NTT, and Hewlett Packard Enterprise.

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Market

Region

Region comparison

Currency

Analyst Opinion

Ireland has emerged as a leading destination for IT outsourcing services in Europe, with a growing number of companies choosing to outsource their IT functions to Irish service providers.

Customer preferences: The rise of IT outsourcing in Ireland can be attributed to several factors, including the country's highly skilled workforce, favorable business environment, and competitive cost structure. Many companies are attracted to Ireland's highly educated and skilled workforce, which includes a large pool of IT professionals with expertise in a wide range of technologies. In addition, Ireland's business-friendly environment, which includes low corporate tax rates and a supportive government, has made it an attractive location for companies looking to establish a presence in Europe.

Trends in the market: One of the key trends in the IT outsourcing market in Ireland is the increasing demand for cloud-based services. Many companies are looking to migrate their IT systems to the cloud in order to reduce costs and improve scalability, and Irish service providers have been quick to respond to this trend. Another trend is the growing importance of data security and privacy, with many companies looking for IT outsourcing providers that have strong data protection policies and procedures in place. Finally, there is a growing trend towards outsourcing IT functions that are not core to a company's business, such as helpdesk support and software development.

Local special circumstances: One of the unique aspects of the IT outsourcing market in Ireland is the country's strong ties to the United States. Many Irish service providers have established close relationships with US-based companies, and this has helped to fuel the growth of the IT outsourcing industry in Ireland. In addition, Ireland's membership in the European Union has made it an attractive location for companies looking to establish a presence in Europe, as it provides them with access to a large and growing market.

Underlying macroeconomic factors: The growth of the IT outsourcing market in Ireland is also being driven by several underlying macroeconomic factors. These include Ireland's strong economic growth, which has made it an attractive location for companies looking to expand their operations. In addition, the country's favorable business environment and supportive government policies have helped to create a vibrant and dynamic IT outsourcing industry. Finally, the ongoing digital transformation of many industries is driving demand for IT outsourcing services, and Irish service providers are well-positioned to capitalize on this trend.

Methodology

Data coverage:

The data encompasses B2G, B2B, and B2C enterprises. Figures are based on enterprises' technology spending on products, consulting, and outsourcing services.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players in the industry, Statista's primary research and surveys, and IT associations. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, internet users, and telecommunication. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing method is used based on the market data characteristics. The main drivers are the GDP and its sector composition, internet penetration, the level of digitization, and the attitude toward IT security.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.