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Global Application Outsourcing Market Size (2024 - 2029)

The application outsourcing market is experiencing growth driven by the increasing demand for digital transformation and customer engagement across various sectors such as banking and retail. This market expansion is facilitated by IT companies offering services that include application maintenance, support, and web portal development, allowing businesses to focus on core operations. The integration of cloud computing has further streamlined these services, making them more cost-effective. Strategic partnerships among companies are also contributing to market growth by enhancing product offerings and expanding service capabilities. Although the Covid-19 pandemic has had a moderate impact on the market, the overall trend indicates a positive trajectory for application outsourcing.

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Market Size of Global Application Outsourcing Industry

Application Outsourcing Market Size
Study Period 2019 - 2029
Base Year For Estimation 2023
CAGR 5.32 %
Fastest Growing Market Asia-Pacific
Largest Market North America
Market Concentration Low

Major Players

Application Outsourcing Market Major Players

*Disclaimer: Major Players sorted in no particular order

Application Outsourcing Market Analysis

The Global Application Outsourcing market is expected to grow at a CAGR of 5.32% during the forecast period, 2022-2027. The ongoing emphasis on customer retention and engagement, increased demand for BFSI, and rising digital transformation are driving the application outsourcing market.

  • IT companies provide application outsourcing services to other companies to outsource their business operations. These services involve testing, designing, and production of business applications. The assistance includes application re-engineering, application maintenance, support, web portal development, and data migration.
  • Third-party companies take care of the businesses by monitoring business functions to avoid the burden of doing that work. Moreover, cloud computing has made the job easier, as it is cost-effective. Various end-users like banking, retail, and others are already using these services, driving the growth of the application outsourcing market.
  • Various companies are looking for strategic partnerships to enhance their products and services. For instance, in May 2022, IBM signed a strategic collaboration agreement with Amazon Web Services to deliver IBM Software-as-a-Service on AWS. The partnership between IBM and AWS will provide clients with quick and easy access to IBM Software that spans automation, AI and data, security and sustainability capabilities, is built on Red Hat OpenShift Service on AWS (ROSA), and runs cloud-native on AWS.
  • Furthermore, companies globally are looking to enhance and innovate their products to provide services to a broader customer base. For instance, in May 2022, IBM enhanced its Global Data Platform to address the challenges related to AI adoption. As per the Global AI Adoption Index 2021, data complexity and data silos are the top barriers to AI adoption.
  • The Covid - 19 pandemic has moderately impacted the application outsourcing market. Lockdown and adoption of work from home by many companies have affected the adoption of application outsourcing and workflow of enterprises.

Application Outsourcing Industry Segmentation

Application outsourcing is an outsourcing arrangement for various application services, including new developments, offshore programming, legacy system maintenance, staff augmentation, and management of packaged applications.

The Global Application Outsourcing Market is Segmented by End-User ( BFSI, Healthcare and Lifesciences, Media and Entertainment, Logistics and Transportation), and by Geography.

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Global Application Outsourcing Market Size Summary

The application outsourcing market is experiencing significant growth, driven by the increasing demand for digital transformation and enhanced customer engagement, particularly in the banking, financial services, and insurance (BFSI) sectors. IT companies are offering a range of services, including application re-engineering, maintenance, and support, to help businesses streamline their operations. The adoption of cloud computing has further facilitated this growth by providing cost-effective solutions. Strategic partnerships, such as those between IBM and Amazon Web Services, are enhancing service offerings, allowing companies to leverage advanced technologies like AI and data analytics. The market is also witnessing a surge in product innovations, with companies like IBM and TCS introducing solutions to address emerging challenges and improve customer experiences.

The competitive landscape of the application outsourcing market is marked by the presence of both local and international players, with major companies like Wipro, IBM, and Accenture leading the charge. The market's expansion is attracting new entrants, driven by the increasing need for outsourcing in sectors such as healthcare and finance. Governments are investing heavily in digital transformation initiatives, further propelling market growth. The COVID-19 pandemic has had a moderate impact, with shifts towards remote work influencing adoption rates. Overall, the market is poised for continued growth, supported by technological advancements and strategic collaborations aimed at enhancing service delivery and customer satisfaction.

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Global Application Outsourcing Market Size - Table of Contents

  1. 1. MARKET INSIGHTS

    1. 1.1 Market Overview

    2. 1.2 Industry Attractiveness - Porter's Five Forces Analysis

      1. 1.2.1 Bargaining Power of Suppliers

      2. 1.2.2 Bargaining Power of Consumers

      3. 1.2.3 Threat of New Entrants

      4. 1.2.4 Threat of Substitute Products

      5. 1.2.5 Intensity of Competitive Rivalry

    3. 1.3 Impact of COVID-19 on the Market

  2. 2. MARKET SEGMENTATION

    1. 2.1 By End-user Industry

      1. 2.1.1 BFSI

      2. 2.1.2 Healthcare and Lifesciences

      3. 2.1.3 Media and Entertainment

      4. 2.1.4 Logistics & Transportation

      5. 2.1.5 Other Categories

    2. 2.2 By Geography

      1. 2.2.1 North America

        1. 2.2.1.1 United States

        2. 2.2.1.2 China

      2. 2.2.2 Europe

        1. 2.2.2.1 Germany

        2. 2.2.2.2 United Kingdom

        3. 2.2.2.3 France

        4. 2.2.2.4 Rest of Europe

      3. 2.2.3 Asia Pacific

        1. 2.2.3.1 India

        2. 2.2.3.2 China

        3. 2.2.3.3 Japan

        4. 2.2.3.4 South Korea

        5. 2.2.3.5 Rest of APAC

      4. 2.2.4 Latin America

      5. 2.2.5 Middle East and Africa

Global Application Outsourcing Market Size FAQs

The Global Application Outsourcing Market is projected to register a CAGR of 5.32% during the forecast period (2024-2029)

Accenture, Wipro Limited, Tata Consultancy Services, Capgemini and HCL are the major companies operating in the Global Application Outsourcing Market.

Application Outsourcing Market Report Snapshots

Application Outsourcing Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)