May 2018 - Market Presentation - Doc # AP43787818
2H17 Country Report on IT Services - Australia
By: Celine Pozzo
This IDC Presentation provides a detailed analysis of the market and competitive landscape in IT services in Australia from July to Dec 2017 (2H17). It covers the market size movements and growth trends in each of the macromarkets (i.e., project oriented, outsourcing, and support and training services) as well as in the key industries such as finance, manufacturing and resources, public sector, distribution and services, and infrastructure. The report also provides a market and vendor analysis of 3rd Platform technologies as the key market drivers. The competitive analysis section includes key strategies and activities of large global and local IT services providers in the market.
The data and insights within this presentation are part of the Asia/Pacific Semiannual Services Tracker research, which covers 14 foundation markets across 14 Asia/Pacific countries.
Political decisions on the skilled immigration issues exacerbated the issue of skills shortage in the IT sector, caused by the discontinuation of the subclass 457 visa, which grants temporary working rights to foreign workers. As the IT industry was already plagued by skills shortage, IT business leaders convinced some politicians of the need to review the visa's legislation; thus, a proposed amendment to the visa restrictions was put forward. The main argument was that some of the major innovative Australian companies that need to scale up, may have to move their operations overseas to hire workers with the necessary skills needed for their expansion; however, the amendment was not approved.
For 2H17, the IT services market growth was led by the project-oriented market, especially the systems integration and network consulting and integration services. The growth was driven mainly by contracts from the government sector, which aims to digitalize its services to provide better service to Australian citizens.
During this cycle, the finance and public sectors have been driving the IT services growth in Australia. The finance sector's priority was to save on operational cost and enhance operations efficiencies, whereas the public sector's main objective was to carry out their digital transformation (DX) initiatives.
DXC, IBM, and Accenture were the leaders of the market during this period. After commencing its operations in April 2017, DXC maintained its customer trust as evidenced by strong revenue growth in the second half of the year. Although sometimes perceived as a costly solution provider by Australian tech buyers, IBM still has one of the most diverse cloud portfolios in the industry, which drove the lion's share of its revenue through the systems integration market, while continuing to focus on its strategic imperatives: cloud, analytics, mobility, and security. Accenture's revenue this cycle was largely driven by its move to the digital space through the acquisition of several start-ups and companies in the country.
Capgemini Services SAS, IBM, Oracle Corporation, Cisco Systems, Inc., Accenture plc, Fujitsu Limited, Hewlett Packard Enterprise, Dell Inc., Dimension Data Holdings PLC, Telstra Corporation Limited, DXC Technology Co.
Application development services, Application management, Hosted application management, Hosting infrastructure services, IT consulting services, IT education and training, IT maintenance and support, Network and desktop outsourcing services, Systems integration services