IT Services Market Size, Share & Trends Analysis Report By Approach (Reactive IT Services, Proactive IT Services), By Type, By Application, By Technology, By Deployment, By Enterprise Size, By End Use, By Region, And Segment Forecasts, 2024 - 2030

IT Services Market Size & Trends

The global IT services market size was valued at USD 1.36 trillion in 2023 and is projected to grow at a CAGR of 9.5% from 2024 to 2030. The market is witnessing rapid expansion, particularly in developing economies such as India and China, aided by the widespread adoption of cloud computing and other advanced digital technologies, the growing importance of cybersecurity solutions among enterprises, and increasing investments to ensure automation and innovation across processes. Moreover, rising privacy protection and data security concerns drive the demand for IT services from companies serving different industry verticals. A sharp increase in the popularity and adoption of artificial intelligence (AI) and machine learning (ML) tools, strong demand for big data and data analytics solutions, constant focus on the development of the IoT & connected devices ecosystem, and the need to comply with data privacy regulations are anticipated to aid industry growth in the coming years. 

As businesses and industries boost their reliance on technology to drive growth, IT service providers are expected to find significant growth avenues to launch innovative solutions and ensure a competitive advantage. The adoption of remote work and hybrid models resulting from the COVID-19 pandemic and the continued popularity of these trends have necessitated a robust IT infrastructure to ensure seamless operations, particularly for larger enterprises that are involved in multiple functions and have thousands of employees. Cloud computing has also experienced significant growth in recent years as businesses migrate their critical operations to the cloud, enabling the deployment of IT services to manage these environments securely. In addition, a sharp growth in IT expenditures owing to an extensive adoption of software-as-a-service (SaaS) models is driving market growth. These services have resulted in a higher efficiency of business processes while enabling companies to focus on their core competencies without worrying about the installed IT infrastructure.

Businesses leverage IT services for various purposes, from standard processes, such as handling employee records, to complex ones, such as supply chain and operations management. The demand for an expansive IT infrastructure from SMEs has grown significantly over the past few years, boosting industry advancement. Businesses of all sizes increasingly provide their employees with digital tools to efficiently and quickly attain operational objectives. Digitalization has resulted in substantial cost savings by optimizing communications between suppliers, personnel, and networks, thus minimizing transaction costs. For small businesses, this digital transformation facilitates a smoother entry into international markets by streamlining transportation and border procedures, creating better opportunities for service commerce.

Approach Insights

The reactive IT services segment accounted for a leading revenue share of 55.3% in the global market in 2023. These services are witnessing consistently high demand due to the increasing complexity of IT systems, which has made it difficult to prevent issues, encouraging businesses to adopt reactive IT solutions. In addition, rising downtime costs have pushed companies to invest in reactive IT services to avoid revenue losses and maximize productivity. The emergence of cloud-based services has further facilitated the implementation of reactive IT measures through constant monitoring, alerting, and incident management capabilities. As a result, the demand for reactive IT services is expected to grow as organizations prioritize safeguarding their IT assets and maintaining a smooth and uninterrupted flow in their operations.

The proactive IT services segment, meanwhile, is estimated to advance at the fastest CAGR over the forecast period. The rapidly growing complexity of IT systems globally, the escalating threat of cyberattacks and data breaches, and a constant demand for improved and more agile IT performance are factors driving segment demand. Proactive services aid businesses in identifying and resolving potential operational issues before they occur, thus avoiding system downtime or data losses. Furthermore, they also encourage the implementation of improved security solutions and the optimization of their IT resources. Additionally, the need to maintain regulatory compliance across industries, improve customer experience, and optimize costs has made investments in proactive IT services necessary for businesses. It enables them to grasp any potential issues or challenges and ensure smoother and more secure operations.

Type Insights

The operations & maintenance segment accounted for the largest revenue share in 2023 and is anticipated to maintain its position during the forecast period. The emergence of cloud computing has led to a shift toward cloud-based operations & maintenance solutions, resulting in higher scalability and increased cost savings. Automation technologies such as Robotic Process Automation (RPA), machine learning, and AI boost efficiency and resource utilization in business processes. Moreover, the increasing utilization of data analytics tools allows organizations to gain valuable insights into IT system performance. Increasing security concerns among enterprises have prompted substantial investments in robust security solutions that can offer strong protection against evolving cyber threats. These trends are anticipated to shape the IT services landscape, with businesses aiming to optimize their operations & maintenance strategies to enhance their performance.

The design & implementation segment is projected to witness steady growth over the forecast period, owing to the emergence and adoption of a range of technological advancements, growing demand for user-focused solutions, and an urgent need for rapid deployment of IT infrastructure. Organizations are actively looking for service providers to help them in their designing and implementation of IT systems and applications. They have become crucial for enterprises aiming to modernize their technology landscape and achieve seamless digital experiences, leading to rapid segment growth.

Application Insights

Application management held the leading revenue share in the market in 2023. The continuous need to enhance application reliability and performance, strengthen application security, lower the cost of ownership, and optimize the application’s overall value are major drivers of this segment. Application management forms an important part of DevOps, with the strategy helping ensure that applications meet user requirements and reduce downtime. Apart from enhancing the reliability and performance of the application, these tools bring a range of cost-saving benefits to businesses. The growing need to identify and mitigate security vulnerabilities, ensure regulatory compliance in a particular industry, and safeguard sensitive data has created substantial demand for robust application management practices.

The data management segment is projected to witness the fastest growth from 2024 to 2030. The growing use of these solutions is aided by the increasing volume of data generated by individuals and enterprises globally, along with the need to utilize data to improve the decision-making process for organizations and gain a competitive edge. Data management has become a vital component for businesses, as it helps in better decision-making by offering access to data that can be analyzed. It also allows enterprises to adhere to data privacy regulations, such as the California Consumer Privacy Act (CCPA) and the General Data Protection Regulation (GDPR). In September 2024, Salesforce announced that it had signed an agreement to acquire Zoomin, which provides data management tools for unstructured data. This acquisition would enable Salesforce Data Cloud to leverage Zoomin’s features, driving context awareness and personalization among AI agents.

Technology Insights

The AI and machine learning segment accounted for the largest revenue share of the global market in 2023. There has been a significant growth in the volume of data generated globally, with the number expected to reach 200 trillion gigabytes by 2025. This trend is expected to encourage the extensive adoption of AI to analyze extensive datasets, extract meaningful insights, and improve the overall decision-making process, leading to streamlined operations and more personalized customer experiences. With the constant decrease in computing power costs, businesses are leveraging AI solutions more frequently, thus facilitating predictive maintenance and real-time fraud detection. The increasing demand for automation to enable organizations to allocate their human resources for more intricate functions has driven the implementation of AI and ML in streamlining activities such as customer service. A report by Forbes Advisor found that 56% of the businesses surveyed aimed to use AI for customer services, followed by 51% for cybersecurity, 40% for inventory management, and 35% for content production. Such widespread use of AI solutions is expected to compel IT companies to launch advanced offerings in this segment.

The big data analytics segment is anticipated to advance at a significant CAGR from 2024 to 2030. Big data has become a valuable tool for businesses aiming to improve their knowledge and understanding of different patterns and trends through integration of data from various sources, thus providing them with a competitive advantage. Additionally, the capability to collect and process data points in real-time helps companies to quickly adapt to dynamic market environments while also enabling them to predict consumer behavior and accordingly offer solutions to boost customer satisfaction. Such benefits have heightened the demand for innovative IT services that leverage big data analytics in their offerings. Countries are extensively investing in infrastructure that can help them to develop and deploy technologies such as big data, AI, and machine learning across verticals such as healthcare, education, and manufacturing, driving substantial market growth.

Deployment Insights

The on-premises segment held a largest revenue share in the global IT services market in 2023 on account of a higher preference for this mode of deployment by businesses globally. The on-premises model provides enterprises with greater control over their IT infrastructure, helping them to manage their applications and data more effectively. On-premises solutions can be configured and customized seamlessly as per business requirements. Additionally, enterprises with highly specialized processes generally choose this arrangement, as standard cloud solutions cannot easily address such needs. Companies in highly regulated sectors consider on-premises solutions to be highly secure, as data is not stored on remote servers, which could be susceptible to cyberattacks. Furthermore, they are in full control over data security instead of being reliant on protocols of third-party organizations, preventing any non-compliance issues.

The cloud segment is expected to grow at the fastest CAGR during the forecast period owing to large and small-sized businesses increasingly adopting cloud-based services to ensure business continuity and disaster recovery. Moreover, steadily reducing costs of cloud computing solutions and the popularity of hybrid cloud and multi-cloud environments contribute to the increasing deployment of cloud-based IT services. The rising demand for scalability, flexibility, and efficiency among businesses to address their IT needs has necessitated the use of cloud infrastructure. According to an article published by Spacelift in March 2024 that cites different sources, 96% of companies use public cloud, while 84% use private cloud. Additionally, 94% of enterprises stated that their security witnessed notable improvements after moving to the cloud, highlighting a strong preference for this deployment model.

Enterprise Size Insights

Large enterprises accounted for a leading market revenue share in 2023. Major global enterprises have traditionally been early adopters of technology and are in a strong position to invest significantly in trending IT services, such as cloud computing, owing to their extensive scale of operations and substantial financial resources. As IT infrastructure becomes more complex, there is a need for specialized expertise and resources to ensure effective management, with large enterprises being well-equipped to cater to these demands. Furthermore, the growing focus on digital transformation has resulted in an increased demand for IT services that can enhance efficiency and agility and improve customer experience, leading to segment growth.

The small and medium enterprises (SMEs) segment is estimated to expand at the fastest CAGR from 2024 to 2030. The growing availability and implementation of cloud-based IT services is a major segment driver, making it more affordable and accessible for small businesses to deploy innovative technologies. Cloud-based offerings provide on-demand access, which is beneficial for SMEs that have limited resources and cannot invest in costly and complex IT infrastructure. The growing adoption of smartphones and other mobile devices has opened up new growth avenues for SMEs, allowing them to utilize these devices to manage inventory, track sales, and communicate effectively with customers. For instance, Cisco has a range of solutions available for small businesses, which includes ‘Smart Net Total Care’ to ensure operational efficiency and comprehensive software support to achieve better returns on investments.

End Use Insights

The IT & telecom segment accounted for a leading revenue share in the global market in 2023. The sector is witnessing steady growth on account of the increasing adoption of cloud computing and other advanced digital technologies by telecom operators to modernize their infrastructure and provide value-added services to their customers. Additionally, the growing demand for IT solutions and managed services from these operators has aided this sector’s expansion. Enterprises are increasingly leveraging the combined advantages of IT and telecom technologies in their operations, leading to an increased need for specialized IT solutions that cater to the industry’s constantly evolving requirements. They help companies in effective network management through real-time monitoring and use of analytics while also protecting their infrastructure and data from cyber threats. The rapid proliferation of 5G and adoption of connected vehicle technologies further drive the demand for seamless and reliable IT services in this industry.

The retail segment is estimated to advance at the fastest growth rate over the forecast period. The sharp growth of the e-commerce sector and rising adoption of omnichannel retail strategies by major brands drive the demand for IT solutions in this industry to support seamless online and offline customer experiences. A growing need for automation and streamlined operations further contributes to the increased demand for IT services among retailers. According to Accenture, around 46% of activities carried out by retail workers can be automated or augmented by implementing large language models (LLMs). Meanwhile, the integration of AI to elevate the shopping experience of customers has also provided a boost to this industry. The technology is being used to optimize supply chains and offer personalized marketing to consumers. Retailers can analyze substantial data volumes to understand consumer behavior, predict industry trends, and make informed decisions. Additionally, the use of IT services to implement inventory management solutions helps retailers track inventory levels in real-time and avoid stockouts. Such benefits have driven retailers to deploy IT solutions in their processes.

Regional Insights

North America IT services market led the market in 2023, accounting for a 36.5% share of the global revenue. The high pace of technological advancements, implementation of digital transformation initiatives, and a growing reliance on technology across industries have driven regional expansion. Increasing deployment of smart technologies and security investments are other notable factors driving regional demand for IT services. Substantial growth in the number of cyberattacks that have impacted businesses across the U.S. and Canada has boosted the adoption of advanced cybersecurity solutions, aiding market advancements. For instance, in March 2023, the Biden-Harris Administration released the National Cybersecurity Strategy to safeguard U.S. citizens from cyber threats and increase investments in future digital infrastructures. Canada has also established a number of IT initiatives, including the Pan-Canadian Artificial Intelligence Strategy, the Connecting Canadians program, and the Digital Ambition project, aimed at strengthening the country’s IT ecosystem.

U.S. IT Services Market Trends

The U.S. IT services market is expected to advance steadily in the coming years due to various technological trends and business requirements that have driven extensive deployment of advanced IT infrastructure. The U.S. is a global leader in terms of digital transformation projects and efforts. Enterprises across several critical industries, such as retail, healthcare, manufacturing, and education, are continuously investing in IT services to deploy cloud technologies, modernize their operations, implement automation and AI in their processes, and elevate customer experience. Additionally, the rising threat of cyberattacks across both small and large organizations drives substantial demand for cybersecurity services to protect sensitive data, customer information, and intellectual property. As per the 2023 Annual Data Breach Report published by the Identity Theft Resource Center (ITRC), the number of data breaches in the country grew by 78 percentage points in 2023 from 2021, highlighting the need for proactive IT solutions to address these issues. The presence of major technological giants such as Google, Microsoft, and Apple in the country has further encouraged innovation and competitiveness in the market.

Europe IT Services Market Trends

Europe IT services market is projected to contribute substantially to the global market in the coming years, owing to an extensive adoption of managed and professional services in regional economies, a growing proliferation of smart technologies, and rising security investments. In January 2022, the European Commission launched eleven major calls for propositions under the Connecting Europe Facility program. With a budget of USD 273.9 million, these calls were aimed at improving the digital connectivity infrastructure, particularly 5G and Gigabit networks, across the region and supporting digital transformation. Several countries are launching projects to encourage the adoption of IT services among businesses and public services, aiding the expansion of the regional industry.

Germany IT services market has a highly advanced automotive, manufacturing, and IT sector, leading to the extensive adoption of technologies such as Big Data, AI, and machine learning among such enterprises. The German government has made substantial efforts to support digital initiatives and promote technological advancements across industries. Furthermore, the country is an early adopter of Industry 4.0 technologies such as automation, data exchange, and IoT (Internet of Things), which have helped optimize manufacturing processes. This has driven the demand for IT services that enable smart manufacturing and efficient supply chain management in the economy. Germany, in partnership with Lithuania, Estonia, and Latvia, published a paper in November 2023 to put forward a range of proposals to improve the digital ecosystem in the European Union and increase the pace of innovations. Such initiatives highlight the country’s importance to the regional market.

Asia Pacific IT Services Market Trends

Asia Pacific is expected to register the fastest CAGR of the market over the forecast period, aided by a substantial rise in spending on IT services from regional businesses. Organizations have understood the various advantages of integrating technology across every level of business and society to ensure more connected and seamless functioning. Additionally, the rapid development of smart city projects in economies such as China and India have necessitated the use of IT solutions and services that can ensure the feasibility and effectiveness of city infrastructure. The presence of a large workforce comprising young professionals with significant expertise in AI, machine learning, and cybersecurity technologies is another notable factor anticipated to positively shape regional market expansion.

India IT services market has witnessed significant advancements in its IT infrastructure in recent years, with the government aiming to boost the country’s contribution to the global market through a series of initiatives and programs. Additionally, the presence of several major IT solution providers, including Wipro, Infosys, and HCL, has helped drive meaningful innovations in the IT sector and the economy. As per the India Brand Equity Foundation (IBEF), the Indian IT sector is expected to contribute 10% to the country’s GDP by 2026. In the country’s Union Budget for 2023-24, the IT and telecom sector was allocated around USD 12 billion to bring substantial developments in cybersecurity, AI, blockchain, and hyper-scale computing. IT companies also aim to improve the skill level of Indian students and professionals by launching several programs, either by themselves or through government collaborations. For instance, in March 2024, Wipro announced a partnership with the Indian Institute of Science (IISc) to offer a higher education program in AI for eligible employees. This course covers major areas such as foundations of ML/AI, business analytics, and data science, addressing the rising demand for these disciplines in the country.

Key IT Services Company Insights:

Some of the notable organizations offerings IT services include IBM, Accenture, Cognizant, and Wipro, among others.

• IBM is a multinational technology solutions and services provider that operates mainly through the software, consulting, financing, and infrastructure segments. Under the software domain, the company offers hybrid cloud and AI platforms, enabling clients to achieve digital and AI transformations across the applications and environments in which they operate. The consulting segment provides skills integration for technology, experience, strategy, and operations based on industry and domain. Under infrastructure, IBM develops both cloud-based and on-premises server and storage solutions, along with lifecycle offerings for deployment of hybrid cloud infrastructure. The financing segment offers commercial and client financing and helps facilitate client acquisition of software, hardware, and services. 

• Accenture provides professional IT consulting, strategy, technology, digital, and operations services. It offers end-to-end solutions across segments including security, cloud, systems integration, application management, software engineering services, data and AI, infrastructure services, and automation, among others. The company specializes in developing business process solutions for a range of enterprise functions, such as finance and accounting, sourcing and procurement, marketing, supply chain, and sales. Accenture serves the automotive, banking, agribusiness, capital markets, travel, retail, health, media and technology, and communications sectors.

Recent Developments

• In September 2024, IBM announced that it had completed the expansion of its IBM Quantum Data Center in New York. This facility operates the largest number of available utility-scale quantum computers at a single location worldwide. The newly deployed IBM Quantum Heron processor offers up to a 16-times increase in performance and a 25-times improvement in speed compared to preceding IBM quantum computers. It forms a part of the company’s objective to upgrade and expand the data center and enhance the size and complexity of quantum workloads that users can run.

• In September 2024, Accenture, through Accenture Ventures, announced a significant investment in Martian, which has developed a patent-pending Large Language Model (LLM) router. This offering finds and utilizes the LLM that presents users with the optimal result for any prompt at the lowest cost. Through this investment, Accenture aims to integrate this advanced model router solution into its “switchboard” services that can enable a greater impact of AI systems by customizing LLMs for specific use cases and data sources.

• In August 2024, Wipro announced that it would extend its collaboration with John Lewis Partnership (JLP). This major UK-based retailer operates department stores and supermarkets to modernize JLP’s IT infrastructure. This is expected to help the company accelerate its growth and positioning in the market and create a future-ready business to drive sustainable growth.

• In June 2024, Cisco launched its Country Digital Acceleration (CDA) program in Vietnam, announced at the Cisco CXO Symposium in Da Nang. This development would allow the company to collaborate with private and public enterprises nationwide to boost the national digitization agenda. The CDA program focuses on promoting economic growth, technological innovations, and cybersecurity resilience in Vietnam by making substantial improvements to the information and communication infrastructure.

IT Services Market Report Scope

Global IT Services Market Report Segmentation

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global IT services market report based on approach, type, application, technology, deployment, enterprise size, end use, and region:

• Approach Outlook (Revenue, USD Billion, 2017 - 2030)

  • Reactive IT Services

  • Proactive IT Services

• Type Outlook (Revenue, USD Billion, 2017 - 2030)

  • Design & Implementation

  • Operations & Maintenance

• Application Outlook (Revenue, USD Billion, 2017 - 2030)

  • Systems & Network Management

  • Data Management

  • Application Management

  • Security & Compliance Management

  • Others

• Technology Outlook (Revenue, USD Billion, 2017 - 2030)

  • AI & Machine Learning

  • Big Data Analytics

  • Threat Intelligence

  • Others

• Deployment Outlook (Revenue, USD Billion, 2017 - 2030)

  • On-premises

  • Cloud

• Enterprise Size Outlook (Revenue, USD Billion, 2017 - 2030)

  • Large Enterprise

  • Small & Medium Enterprise

• End Use Outlook (Revenue, USD Billion, 2017 - 2030)

  • BFSI

  • Government

  • Healthcare

  • Manufacturing

  • Media & Communications

  • Retail

  • IT & Telecom

  • Others

• Regional Outlook (Revenue, USD Billion, 2017 - 2030)

  • North America

    • U.S.

    • Canada

  • Europe

    • Germany

    • UK

    • France

  • Asia Pacific

    • China

    • Japan

    • India

    • South Korea

    • Australia

  • Latin America

    • Brazil

    • Mexico

  • Middle East and Africa (MEA)

    • Kingdom of Saudi Arabia

    • UAE

    • South Africa