Ovum has released new figures indicating that the IT services sector has bounced back from a tough first quarter with the number of deals increasing by 14 per cent in Q2.
According to the independent technology analyst, the second quarter of 2010 was the best in 12 months for the number of deals announced across the industry.
Ovum analyst Ed Thomas said while the news is good for IT services, a low level of outsourcing is worrying.
"While the surge in the number of contracts announced for IT services in Q2 is good news for the sector, concerns remain about the scale of outsourcing in the private sector, where TCV [Total Contract Value] for Q2 slipped to only $10 billion as clients shied away from signing large deals," he said.
Thomas said the year has been a tough one for vendors with the number of deals announced falling.
"Analysis of both IT services deal signings and TCV in the first six months of 2010 reveals an extremely difficult start to the year for vendors. A total of 858 deals have been announced, down 13 per cent on the same period of the previous year and the lowest figure since the first half of 2007 when only 778 deals were tracked," he said.