Worldwide IT outsourcing (ITO) grew 7.8% in 2011. In a report by analyst firm Gartner, spending on ITO in 2011 reached $246 billion, compared to $228.7 billion in the previous year. Forty three ITO businesses sold more than $1 billion worth of services individually.

“Indian-based IT services providers and providers rooted in cloud-based services delivered the highest growth rates in 2011,” said the report.

IBM maintained its status as the number one IT service provider, with a 7.8% growth in revenue to $26.9 billion, accounting for 10.9% of the world ITO market. HP grew by only 2%, but retained its position as number two in the market with a 6.1% share. Fujitsu, helped by currency gains, leapfrogged CSC into third place. Accenture experienced the biggest growth out of the top five suppliers, with an 18% increase.

India-based ITO firms showed the highest levels of growth. Wipro ITO revenue grew by 12.3%, Infosys by 17.9%, HCL by 26.0%, TCS by 29.8%, and Cognizant by a huge 32.2% during 2011.

Bryan Britz, research director at Gartner, said: "Revenue cannibalisation resulting from client adoption of industrialised, and often cloud-based, services risks muting the growth opportunities for the ITO providers that are heavily weighted in infrastructure outsourcing.”

He continued: "Strategies will vary as clients are likely to pursue hybrid cloud strategies requiring providers to deliver some asset-light and some asset-heavy offerings — which will result in varying growth trajectories among competitors over the next several years."