Managed services market to crack $66 billion by 2012

Managed services is a big part of the IT industry these days. Accent's managed services product (AMS) is a large part of our forward looking business plan and is a service that many of our customers are evaluating as a way to ease the burden of the internal IT staff (if one exists at all).

NetworkWorld.com has an article up about the IT managed services market and its continual growth through 2012. The article states "the global market for managed services will deliver revenues of $66 billion by 2012."

The Cisco commissioned study was performed by Ovum, a consulting firm that specializes in telecom and software consulting. Ovum "finds that the managed services generating the most interest among corporate users are managed metro Ethernet, managed IP, VPNs, managed VoIP and managed security."

"IP VPN services are the largest global managed services market, with revenues totaling $17 billion, the study finds." However, VoIP looks to be the biggest growth area in the coming years with an expected growth percentage of near 40%.

The article is pretty good and can be found here.

HP buys EDS for $13.9 billion

Credit: NetworkWorld.com

HP said Tuesday morning that it has signed a deal to acquire IT outsourcer EDS for $13.9 billion, or $25.00 per share.

The deal has been approved by both companies' boards of directors, and is expected to close in the second half of this year.

HP said it will more than double its services revenue.

The deal will greatly expand HP's IT services business and catapult it to the number two spot close behind IBM, whose Global Technology Services division has long been a strong profit generator for the company.

"I see [the acquisition] as an attempt by HP to really go head to head with IBM in a much more meaningful way, especially in technology services and IT outsourcing," Dana Stifler, research director with AMR Research, said Monday, while the two companies were still in talks.

The worldwide market for IT services was worth $748 billion in 2007, an increase of 10.5 percent from the year before, according to recent figures from Gartner. IBM led the market with about $54 billion in revenue, followed by EDS with $22 billion. HP was in fifth place with revenue of $17 billion, behind Accenture and Fujitsu.

Buying EDS will grow HP's services business and allow it to offer a wider range of services to attract large business customers. EDS is strong in infrastructure management services and also custom application services, where it helps companies to design, integrate and manage applications.

EDS is less strong in providing services for packaged applications, however, and the acquisition will not give HP a big lift in the type of business consulting services delivered to line managers and business executives either, Stiffler said Monday.

You can see the entire article here.