IT Outsourcing - Brazil

Brazil

Revenue in the IT Outsourcing market is projected to reach €6.15bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 9.61%, resulting in a market volume of €9.73bn by 2029.
The average Spend per Employee in the IT Outsourcing market is projected to reach €56.10 in 2024.
In global comparison, most revenue will be generated in the United States (€183.00bn 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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Mercado

Región

Comparación de regiones

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Analyst Opinion

Brazil, the largest country in South America, has been experiencing a significant development in the IT outsourcing market. With a population of over 200 million people and a rapidly growing economy, Brazil has become an attractive destination for companies looking to outsource their IT services.

Customer preferences: Brazilian companies are increasingly looking for cost-effective ways to improve their IT infrastructure and services. Many companies are turning to outsourcing as a way to achieve these goals. Additionally, the demand for IT services has been increasing due to the rise of e-commerce and the need for digital transformation in businesses.

Trends in the market: One of the main trends in the IT outsourcing market in Brazil is the growth of cloud computing services. Cloud computing allows companies to access IT resources and services over the internet, which can be more cost-effective and flexible than traditional IT infrastructure. Another trend is the emergence of new outsourcing destinations within Brazil, such as the Northeast region, which offers lower costs and a skilled workforce. Additionally, there has been an increase in the number of companies outsourcing IT services to Brazil from other countries, such as the United States and Europe.

Local special circumstances: One of the unique characteristics of the IT outsourcing market in Brazil is the strong presence of domestic IT service providers. These companies offer a range of services, from software development to infrastructure management, and are often more cost-effective than international providers. Additionally, Brazil has a large pool of skilled IT professionals, which makes it an attractive destination for companies looking to outsource their IT services.

Underlying macroeconomic factors: Brazil's economy has been growing steadily in recent years, which has led to an increase in the demand for IT services. Additionally, the Brazilian government has been implementing policies to promote the growth of the IT industry, such as tax incentives for IT companies. However, Brazil's political instability and high levels of corruption have created challenges for the IT outsourcing market. Companies may be hesitant to invest in Brazil due to these factors, which could limit the growth of the market in the future.

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.