Brazilian IT Providers Expand their Offering to Cloud and Managed Services to Increase Revenue

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The latest Frost & Sullivan’s research, Brazilian IT Outsourcing Market, Forecast to 2021, sheds light on the impacts of recent technological innovations, critical business and economic considerations that are aiding and hampering the outsourcing model adoption. The information technology (IT) outsourcing segment corresponds today at 48.5% of the total IT industry in Brazil; it is expected to attain $US 7.96 billion dollars by 2021, while it reached $US 6.68 billion in 2016.

The Brazilian economic scenario influenced the performance of the services market, and forced companies to reduce expenditure and focus on maintaining the operation and increasing efficiency. As a result, the business has shifted from traditional IT services to new platforms and technologies that offer faster implementation at more competitive prices.

“IT investments have been primarily directed at cloud solutions, such as SaaS, as a way to reduce investments in the acquisition of hardware and software while optimizing the infrastructure by adapting the capacity of processing to demand,” stated Renato Rosa, Information & Communications Technology Program Manager at Frost & Sullivan.

The study revealed that:

• As cloud solutions take root, companies are having difficulty managing their cloud services, often provided through multiple vendors. Thus, IT companies are aiming to serve as cloud brokers or cloud management providers. IT companies also have the opportunities to help companies manage data centers;
• Finance is still the largest sector that invests in IT and is beginning to adhere to the cloud model;
• Application Management is the fastest growing service line. This stems from the needs of companies to have a better understanding and control of business processes;
• IT service providers have found new opportunities by diversifying their portfolios and adding small to medium-sized businesses (SMBs) to their target audience as a way to increase revenue.

“Over the next few years, many companies will need to revise their business infrastructure and will be looking for companies that have IT services that align with their business needs,” concluded Rosa.

Brazilian IT Outsourcing Market, Forecast to 2021 is part of Frost & Sullivan’s Digital Transformation GrowthPartnership Service program. 

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