IT Services - LATAM

LATAM

In 2024, the revenue in the IT Services market in LATAM is projected to reach US$56.53bn.
Other IT Services is the dominant segment in this market, with a projected market volume of US$18.48bn in 2024.
Furthermore, the revenue is expected to exhibit a compound annual growth rate (CAGR 2024-2029) of 5.67%, resulting in a market volume of US$74.49bn by 2029.
Additionally, the average Spend per Employee in the IT Services market is projected to reach US$182.90 in 2024.
When compared globally, United States is expected to generate the highest revenue, amounting to US$522.00bn in 2024.
In LATAM, the IT Services market is experiencing significant growth, with Brazil leading the way as the largest market in the region.

Key regions: United States, China, India, Japan, Germany

Definition:
The IT Services market encompasses a wide range of services used by organizations to create, manage, and deliver information, and it includes services that provide assistance with various other business functions. The primary goal of IT services is to ensure that information technology infrastructure, applications, and systems are effectively implemented, operated, and optimized to support an organization's business objectives and requirements. The specific range of services offered may vary depending on the service provider and the client's requirements.

Structure:

IT Services contains four distinct markets that are based on different services:

IT Consulting & Implementation covers advisory services that help businesses evaluate their technology strategies and align them with their business strategies or internal processes.
Business Process Outsourcing (BPO) refers to the transfer of entire business processes or individual activities from a company to a third party and is often IT based. BPO covers a wide variety of business processes, usually either in the back office (e.g., human resources) or in the front office (e.g., customer service in call centers).
IT Outsourcing refers to the external contracting of all IT-related services instead of relying on company-owned resources. In an IT context, these activities include IT administration, IT application, and web hosting services.
The Other IT Services market covers revenues for areas that are not specifically mentioned in the other markets, such as system integration, software installation and support, and IT education and training.

Additional Information:

The IT Services market comprises revenues, revenue change, average spend per employee, and a list of the key players in the market and their consolidated revenues. 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, Cognizant, Hewlett Packard Enterprise, and TCS.

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Analyst Opinion

The IT Services market in LATAM is experiencing significant growth and development, driven by various factors such as increasing customer preferences for outsourcing IT services, emerging trends in the market, local special circumstances, and underlying macroeconomic factors. Customer preferences in the IT Services market in LATAM are shifting towards outsourcing IT services to third-party providers.

This preference is driven by the need for cost reduction and access to specialized expertise. Many companies in the region are realizing the benefits of outsourcing their IT services, including reduced operational costs, improved efficiency, and access to a wider range of technical skills. Additionally, outsourcing allows companies to focus on their core business functions while leaving IT management to experts.

Trends in the IT Services market in LATAM are also contributing to its development. One of the major trends is the increasing adoption of cloud computing services. Cloud computing offers scalability, flexibility, and cost-effectiveness, making it an attractive option for companies in the region.

As a result, there is a growing demand for cloud-based IT services, including infrastructure-as-a-service (IaaS), platform-as-a-service (PaaS), and software-as-a-service (SaaS). Another trend in the market is the rising importance of cybersecurity services. With the increasing number of cyber threats and data breaches, companies in LATAM are prioritizing the protection of their sensitive information.

This has led to a higher demand for cybersecurity services, including threat detection and prevention, vulnerability assessments, and incident response. Local special circumstances in the region also contribute to the development of the IT Services market. One such circumstance is the presence of a large pool of skilled IT professionals.

LATAM has a strong talent pool in the IT sector, with many highly skilled and educated professionals. This talent pool attracts both local and international companies to outsource their IT services to the region. Underlying macroeconomic factors also play a role in the growth of the IT Services market in LATAM.

The region has experienced steady economic growth in recent years, which has led to increased investments in technology infrastructure and digital transformation initiatives. Additionally, government initiatives to promote the IT sector and attract foreign investment have further fueled the growth of the market. In conclusion, the IT Services market in LATAM is developing rapidly due to customer preferences for outsourcing, emerging trends in the market, local special circumstances, and underlying macroeconomic factors.

The region's focus on cost reduction, access to specialized expertise, and the adoption of cloud computing and cybersecurity services are driving the growth of the market. With a large pool of skilled IT professionals and favorable macroeconomic conditions, LATAM is becoming an attractive destination for companies looking to outsource their IT services.

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.