Survey: boomtime for Internet services business

Outsourcing leads tenfold expansion of Net services arena by 2002, claims IDC

Internet-related business is set to expand from last year's value of $4.5 billion to $43.6 billion by 2002, claims market researcher IDC in its Worldwide Internet and E-commerce Services Market and Trends Forecast. The key phrase is 'Internet-related'. IDC is counting the broader range of services and solutions, such as Internet strategy consultancy, application development, networking and data security specialists, support service providers and outsourcing companies. Outsourcing in particular is likely to become a key component of the Internet services market, said IDC. In the US, spending on outsourcing Internet operations leapt from $350 millio to $613 million in the last year alone -- by 2002, IDC reckons it will have reached $3.6 billion. That trend certainly chimes with vendors' strategies -- the major announcements of late from the likes of Netscape, IBM, Sun, Hewlett-Packard and others have focused on ISPs rather than user organisations. IDC identifies the shift of the Internet's business focus away from content to commerce as the driving force behind the growth of Internet services. As companies are catching on to that fact, "they are finding themselves strapped for the necessary resources", said IDC senior analyst for Internet services, Meredith McCarty. A separate IDC survey, The Global Market Forecast for Internet Usage and Commerce, predicts the amount of business conducted on the Net will reach $400 billion in the same timeframe. Over the period 1997-2002, the number of customers buying via the Web will grow from 18 million to over 128 million. But while the US will dominate growth in the Net services market, the rest of the world will provide the bulk of Web buyers, in particular Asia, IDC believes. ® Click for more stories Click for story index

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