IT Outsourcing - Bahrain

Bahrain

Revenue in the IT Outsourcing market is projected to reach US$58.41m in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 8.47%, resulting in a market volume of US$87.71m by 2029.
The average Spend per Employee in the IT Outsourcing market is projected to reach US$65.93 in 2024.
In global comparison, most revenue will be generated in the United States (US$197.30bn 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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Market

Region

Region comparison

Currency

Analyst Opinion

Bahrain, a small island nation in the Persian Gulf, has been experiencing a steady growth in its IT outsourcing market in recent years.

Customer preferences: Bahrain's IT outsourcing market is primarily driven by the demand for software development and maintenance services. The country's business-friendly policies and strategic location have made it an attractive destination for companies looking to outsource their IT needs. Bahrain's workforce is highly skilled and proficient in English, making it easier for companies to communicate with their offshore teams.

Trends in the market: One of the trends in Bahrain's IT outsourcing market is the increasing demand for cloud-based services. Companies are looking to move their IT infrastructure to the cloud to reduce costs and increase efficiency. This trend is expected to continue in the coming years as more companies in Bahrain adopt cloud-based solutions.Another trend in Bahrain's IT outsourcing market is the rise of artificial intelligence (AI) and machine learning (ML) technologies. Companies are incorporating these technologies into their products and services to improve customer experience and gain a competitive edge. Bahrain's government is also investing in AI and ML technologies to enhance its public services.

Local special circumstances: Bahrain's IT outsourcing market is unique in that it is heavily influenced by the country's financial services sector. Many IT outsourcing companies in Bahrain cater to the needs of the financial services industry, providing services such as software development, data analytics, and cybersecurity.

Underlying macroeconomic factors: Bahrain's IT outsourcing market has been supported by the country's efforts to diversify its economy away from oil. The government has implemented policies to encourage foreign investment and promote entrepreneurship, which has attracted many IT outsourcing companies to the country. Additionally, Bahrain's strategic location and easy access to other Gulf Cooperation Council (GCC) countries make it an ideal location for companies looking to expand their operations in the region.

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.