Worldwide IT and business services revenue fell 1.16 percent in constant currency and 1.53 percent in dollar in 2020 to above $1 trillion, according to a revised forecast from IDC.
IDC expects the services market to have a strong rebound in 2021. The current forecast projects year-over-year growth in both 2021 and 2022 to be around 4 percent.
Most top vendors saw revenue growth slow or decline last year, particularly in Q2 and Q3. However, in aggregate, the 2020 market contraction was softer than expected and overall better than the decline in global GDP.
Services spending in some regions or countries, especially Europe, the Middle East, and Africa (EMEA) and Asia Pacific, is being driven by large government digital initiatives coupled with businesses’ growing trust and confidence in their governments’ handling of the pandemic and economy.
Most vendors believe that the crisis has tipped organizations and consumers over to the digital world – a net positive in the long run. In this forecast, IDC believes that the magnitude and timing of this transition have been slightly larger and sooner than anticipated.
“While 2020 has been a challenging year for services vendors both from a supply and demand side, the services market remained resilient and major vendors are reporting stronger bookings and pipelines,” said Xiao-Fei Zhang, program director, Global Services Markets and Trends at IDC.