London outsourcing grows

London IT outsourcing could continue to grow this year, despite the global economic slowdown, a report suggests, according to ihotdesk.

Allie Young, VP and analyst at Gartner, predicts IT outsourcing solutions will be implemented by companies seeking to work through financial and competitive difficulties.

She says this will outweigh the number of companies' in-housing processes and leave the sector ultimately expanding.

India has become synonymous with tech outsourcing, states BusinessWeek.

More than 90% of tech services that are performed in low-cost countries happen there.

But when IBM announced its two newest global service delivery centres this week, they weren't in Bangalore, Delhi, or Mumbai. Instead, Big Blue picked East Lansing, Michigan, and Dubuque, Iowa.

China's IT outsourcing industry remains well behind India's, but has made great strides in recent year and the economic crisis presents an opportunity to close the gap, consultancy McKinsey & Co said on Wednesday, reports Reuters.

"If you really want to jump-start the growth, if you want to grow double or triple ... don't miss a huge opportunity here," Alex Peng, a McKinsey partner, told reporters.

Presenting a report on China's outsourcing sector, McKinsey said it figures the global outsourcing sector shrunk by 39% in the first nine months of 2008, to $11 billion in total contracts, but will benefit as companies around the world desperately look for ways to reduce costs.