IT Outsourcing - Malaysia

Malaysia

The IT Outsourcing market in Malaysia is expected to experience significant growth in the coming years.
According to projections, the revenue in this market is set to reach US$1.96bn by 2024.
This growth is expected to continue at an annual rate of 10.37% from 2024 to 2029, resulting in a market volume of US$3.21bn by the end of that period.
Furthermore, the average Spend per Employee in the IT Outsourcing market is estimated to reach US$108.20 in 2024.
This indicates the level of investment being made in the industry in Malaysia.
In terms of global comparison, United States is expected to generate the highest revenue in the IT Outsourcing market, with a projected amount of US$197.30bn in 2024.
This highlights the dominant position of the United States in this industry.
These figures demonstrate the potential growth and opportunities that the IT Outsourcing market in Malaysia holds.
With its strategic location, skilled workforce, and competitive advantages, in Malaysia is well-positioned to attract investments and become a key player in the global IT Outsourcing market industry.
The IT outsourcing market in Malaysia is experiencing significant growth due to its highly skilled workforce and competitive labor costs.

Key regions: Brazil, Italy, United States, China, Germany

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

Malaysia, the Southeast Asian country known for its diverse culture and stunning landscapes, has been making strides in the IT outsourcing market in recent years.

Customer preferences: One of the main reasons for the growth of the IT outsourcing market in Malaysia is due to the increasing demand for cost-effective solutions from businesses around the world. Many companies are looking to outsource their IT needs to countries like Malaysia, where they can get high-quality services at a lower cost. Additionally, Malaysia's skilled workforce, proficiency in English, and strong government support for the IT industry make it an attractive destination for outsourcing.

Trends in the market: One of the key trends in the IT outsourcing market in Malaysia is the rise of cloud computing services. With the increasing demand for cloud-based solutions, many IT outsourcing companies in Malaysia are investing in this technology to offer their clients more efficient and cost-effective services. Another trend is the growing popularity of mobile app development services. As more businesses look to develop mobile applications to reach their customers, IT outsourcing companies in Malaysia are offering specialized services to meet this demand.

Local special circumstances: Malaysia's strategic location and strong government support for the IT industry have also contributed to the growth of the IT outsourcing market. The country's proximity to other major Asian markets, such as China and India, makes it an ideal location for companies looking to expand their operations in the region. Additionally, the Malaysian government has implemented various initiatives to support the growth of the IT industry, such as tax incentives and funding for research and development.

Underlying macroeconomic factors: The growth of the IT outsourcing market in Malaysia is also influenced by broader macroeconomic factors, such as the country's stable political environment and economic growth. Malaysia's economy has been growing steadily in recent years, and the government has been implementing policies to attract foreign investment and promote economic development. This has created a favorable environment for the IT outsourcing industry to thrive, as companies look to take advantage of Malaysia's skilled workforce and cost-effective solutions.In conclusion, Malaysia's strong government support, skilled workforce, and cost-effective solutions have made it an attractive destination for businesses looking to outsource their IT needs. With the rise of cloud computing services and mobile app development, the IT outsourcing market in Malaysia is poised for continued growth in the coming years.

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.