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Ovum's Latest UK IT Industry Rankings Highlight Market Evolution

August 16, 2007, Ovum published its UK software and IT services (S/ITS) industry rankings. There's good news for EDS, which takes back the no.1 spot from IBM, thanks to a year of MoD-driven growth.

"Perhaps the most striking recent success story in the upper echelons is Capgemini, which jumps to no.4 in the table this year," points out Phil Codling, principal analyst. "As recently as 2003, the French firm was on the verge of dropping out of our top 10 altogether, but that was before it started to benefit from its "Aspire" mega-deal with HM Revenue & Customs." he continues.

Figure 1: Top 20 UK S/ITS Players by Revenue

Other Key Trends

U.S. Giants Lose Market Share. Despite supplying nine of the current top 20, the U.S. is losing share in the UK S/ITS market. Ovum's analysis shows that its corporations have underperformed the UK market in the last three years and have consequently seen their share of top 50 revenue fall (from 54 to 47 percent). That's despite the acquisition-fuelled expansion of a number of major software firms, notably Oracle, and underlines just how hard it has been for the large global outsourcers to grow and adapt in a mature, multi-sourcing environment.

India on the Rise. As for the growing nations, India not surprisingly stands out. Driven by sustained demand for offshoring capability and lower prices, the country has tripled its share of top 50 revenues since 2003 and now has four representatives (TCS, Wipro, Infosys and HCL) in our rankings. But for all the growth of such players, it's worth noting that their market share remains pretty low - at just 5 percent of the combined revenues of the top 50. Indeed, Japan with just one representative in rankings - Fujitsu - still claims a bigger slice of the UK top 50 than India!

UK Players Holding Their Own. It's become commonplace to bemoan the lack of homegrown presence in the software and IT services industry. However, UK-based players have managed to sustain their share of the revenues of the top 50 players. Ovum's analysis shows that their combined share has fallen just one percentage point over the past three years, from 29 to 28 percent. Over the same "post-boom-bust" period, UK representation in the top 50 has dipped slightly from 26 firms to 23.

Subsector Leaders Hold On. Ovum's analysis also confirms that the leaders in the main subsectors of the market have retained their positions this year. That means Microsoft continues to lead the UK software market by some margin from closest rivals Oracle, IBM and SAP. Capita remains the undisputed leading player in business process outsourcing, following another year of double digit growth. In the project services and app-led outsourcing segment, IBM Global Services is no.1, while EDS keeps its infrastructure services crown.

For more information or to speak with Phil Codling about this research, please contact Ovum Public Relations, prteam@ovum.com.


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