2006-08-05

Over US$1.36 billions of China Software Outsourcing Market

Software Outsourcing (SO) industry developed quickly in recent years. More enterprises in developed country show zeal for IT service outsourcing. It also brings great opportunity to China. From 2005-2009, market CAGR is expected to be 40%, and over US$1.36 billions' potential market is held in the industry.

The development of software outsourcing market benefits from variegated and multi-level cooperation between customers and service providers. For China SO market, the progress is featured with two qualities: customer centralization and service provider decentralization.

Customers are mostly from Europe, USA and Japan. In the past two years, customers from these areas took up over 80%. Moreover, with China companies' exploitation of these markets, as well as more cooperative partnership established between these regional customers and Chinese enterprises, business between the two parts will increase further.

China SO service companies are transferring from Northeast, North China and East China to Mid-China and West China etc., because labor cost in the first three areas becomes much higher, while the key point of software outsourcing is to achieve lower business cost. Thus decentralization of SO service providers is a trend of development.

Source: China Computerworld Research

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