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Information technology | Prices of IT outsourcing deals expected to shrink

Information technology | Prices of IT outsourcing deals expected to shrink
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First Published: Mon, Mar 23 2009. 11 31 PM IST
Updated: Mon, Mar 23 2009. 11 31 PM IST
Bangalore: Prices of global information technology (IT) services outsourcing contracts are expected to shrink as much as 20% till 2010 due to the current economic downturn and technology budget constraints, researcher Gartner Inc. said on Monday.
Gartner said that this fall in prices will occur due to increasing competition in the market between traditional and new providers as more providers compete aggressively to keep revenue growth on target, while ensuring margins.
“Regardless of the relative strength of outsourcing during a recession, many clients are reporting intense discussion with their vendors and renegotiation of contracts for terms and conditions service level agreements, fees, volumes and low-cost offshore delivery locations,” Claudio Da Rold, vice-president and analyst at Gartner, said in a statement.
“These items are under scrutiny to identify satisfactory concessions to further reduce the cost of services on a case-by-case basis, ” he said.
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First Published: Mon, Mar 23 2009. 11 31 PM IST