49% increase in spending on outsourcing in 2003.

Position:IT News

Outsourcing attracted a lot of negative publicity in 2003, as clients including the UK Inland Revenue and the US Internal Revenue Service ran into problems with their incumbent suppliers. However, this has not deterred organizations from committing to bigger and longer deals. The UK Inland Revenue is a prime example. After ending a heavily criticized deal with EDS, the Government department signed a new $5.1bn deal with Cap Gemini Ernst & Young in December 2003, in what ranked as the year's largest single contract.

Datamonitor tracked $119bn of major IT services contracts in total during 2003, which represented a 44% increase over 2002. The biggest spending sector was the central government sector where Datamonitor tracked $18.5bn of contracts, which was more than double the level in the previous year. The defense sector was the second biggest investor, with $18.2bn in deals during 2003.

Global contracts with...

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