Application Outsourcing Market Size, Share, Competitive Landscape and Trend Analysis Report, by Type, by Enterprise Size, by End-User : Global Opportunity Analysis and Industry Forecast, 2024-2032

Key market dynamics 

The global application outsourcing market growth is rising significantly due to several factors such as the need to innovate and expand business processes, growth in digital transformation, and increased adoption of advanced code analysis software. However, the lack of skilled experts in some regions and unawareness of technology act as restraints for the application outsourcing market. In addition, an increase in spending on IT infrastructure in some of the developing countries is anticipated to provide ample opportunities for market growth during the forecast period.  

Outsourcing Adoption in Different Industries 

Outsourcing services are widely adopted by various industries to eliminate the workload and enhance product efficiency. Of those companies already engaged in some application outsourcing activity, eApplication systems management turned out to be the most commonly outsourced application function; 51% currently outsource this area of spending. According to the article published by Capgemini in 2021, IT management & infrastructure is the most outsourced business function (49%), followed by payroll (39%) and logistics (32%). Finance & Accounting (18%) and legal (13%) joined application (12%) as the three least outsourced business areas. 

FIGURE 1: INDUSTRIES MANAGED BY OUTSOURCE SERVICES (%)  

Market Segmentation 

The application outsourcing market size is segmented into type, enterprise size, end–user, and region. On the basis of type, the market is divided into application development service, application maintenance service, independent software testing service, and others. On the basis of enterprise size, the market is bifurcated into large enterprises and small & medium-sized enterprises. On the basis of end user, the market is classified into automotive, government, consumer electronics, IT & telecom, BFSI, and others. Region-wise, the market is analyzed across North America, Europe, Asia-Pacific, Latin America and Middle East and Africa. 

Regional/Country Market Outlook 

The global application outsourcing market has experienced substantial growth, with North America playing a pivotal role in this expansion. North America leads the market, propelled by robust technological infrastructure, significant investments in smart technologies, and stringent safety regulations that encourage the integration of advanced application outsourcing solutions. Europe follows closely, with countries such as Germany and the UK at the forefront, leveraging application outsourcing solutions. In the Asia-Pacific region, rapid digitalization and increase in awareness of smart retail solutions drive the adoption of application outsourcing solutions, particularly in China and Japan, where government initiatives support technological advancements. 

• In October 2023, the UK government raised $6.09 billion investment framework for public sector organizations to purchase outsourced contact center and business process services over the next four years. 

• In January 2023, the Japanese government introduced an additional scheme for IT application by government organizations and made online application of IT software possible. 

Industry Trends 

• In February 2024, the UK government launched two tenders for cloud services that could jointly raise $9.5 billion in investment under framework agreements. In a separate application initiative, the UK government is seeking a tech firm to help public policies. 

• In November 2023, the Government of Canada allocated $669, 650 million for the contract that aims to explore efficient utilization and investment of tax dollars. This move comes as the Canadian government's spending on outsourcing has surged, contrary to the Liberals' 2015 pledge to reduce reliance on external consultants. 

Competitive Landscape 

The major players operating in the application outsourcing market include Unisys Corporation, Wipro Limited, Hewlett-Packard Development Company, L.P., CGI Group, Dell Inc., Tata Consultancy Services, iGATE, Fujitsu Ltd., IBM Corporation. 

Recent Key Strategies and Developments 

• In July 2023, NTT DATA launched an outsourcing service for security management (MDR service) to prevent incidents and minimize damage when incidents occur. 

• In March 2023, Rimini Street, Inc. launched Rimini ONE, its outsourcing service program designed to offer a comprehensive set of unified integrated services to run, manage, support, customize, configure, and optimize enterprise applications and software. 

Key Sources Referred 

1. GEP 

2. Asian Development 

3. Sourcing Industry Group 

4. Harvard Business Review 

5. KPMG 

Key Benefits for Stakeholders 

• This report provides a quantitative analysis of the application outsourcing industry segments, current trends, estimations, and dynamics of the application outsourcing market analysis from 2023 to 2032 to identify the prevailing application outsourcing market opportunities. 

• Market research is offered along with information related to key drivers, restraints, and opportunities. 

• Porter's five forces analysis highlights the potency of buyers and suppliers to enable stakeholders to make profit-oriented business decisions and strengthen their supplier-buyer network. 

• In-depth analysis of the application outsourcing market forecast segmentation assists to determine the prevailing application outsourcing market opportunity. 

• Major countries in each region are mapped according to their revenue contribution to the global application outsourcing Market share Statistics. 

• Market player positioning facilitates benchmarking and provides a clear understanding of the present position of the market players. 

• The report includes the analysis of the regional and global application outsourcing market trends, key players, market segments, application areas, and market growth strategies.