Features

APEJ BPO Market to Reach USD 14 Bln by 2010: IDC

By Sophia Mayengbam

Business Process Outsourcing in Asia/Pacific excluding Japan (APEJ) market shows moderate growth from 2006 to 2010, predicts research firm IDC. IDC said the reason is APEJ will remain at the developmental stages of BPO during this period.

"Even though APEJ is a main center for BPO, majority of the contracts will still be derived outside of the region, mainly from the United States and Western Europe. Local adoption will be more opportunistic," said Conrad Chang, IDC's Senior Market Analyst for Asia/Pacific BPO Services Research. “Although processing services will continue as the dominant form of business outsourcing, more pilot BPO projects are expected to emerge in the pipeline."

Over the past 12 months, companies such as Accenture, EDS, HP and IBM have opened massive BPO centers in PRC, India and the Philippines, largely for servicing the United States and Europe, and not APEJ. In light of these investments, IDC said it remains confident in its BPO outlook for the region and predicts moderate growth and adoption.

BPO in 2005 totaled USD 6 billion and this figure is forecast to rise to about USD 14 billion by 2010 at a compound annual growth rate (CAGR) of approximately 18 percent.

The following summarise IDC's forecasts for BPO in APEJ for the period 2006 to 2010.

Fig: IDCs Forecast and Analysis for BPO in the APEJ Region for 2006 - 2010 by Horizontal Businesses (Source: IDC, 2006)

According to the report Asia/Pacific (Excluding Japan) Business Process Outsourcing 2006 – 2010 Forecast and Analysis Human Resources and Training and Finance and Accounting will continue to be the main drivers of BPO adoption in APEJ during the forecast period.

Training is often reflected as a human Resource cost and Australia and New Zealand will continue to be the biggest markets for BPO in APEJ for the duration of the forecast period.