IDC: Worldwide Services Revenue Posting Steady Growth
Worldwide revenues for IT Services and Business Services totaled $506 billion in the first half of 2018, an increase of 4% year over year, according to International Data Corporation (IDC), a market researcher headquartered near Boston. According to IDC’s Worldwide Semiannual Services Tracker, the first half of 2018 was a mixed bag for tier-one global outsourcers/integrators with more than $10 billion in services revenue. Most remained flat or declined slightly.
Project-oriented revenues grew by 5.2% in 1H18 to $191 billion, followed by 3.6% growth for managed services and 2.7% for support services. Most major management consulting firms posted strong earnings in 2018, although growth rates cooled slightly.
Outsourcing revenues grew 3.6% to $238 million in 1H18. Application-related managed services revenues (hosted and on-premise application management) outpaced infrastructure and business process outsourcing.
On the infrastructure side, while hosting infrastructure services revenue accelerated to 7.2% growth in 1H18, mostly due to cloud adoption, IT Outsourcing declined by 1.5%, largely chipped away by cloud cannibalization across all regions.
On a geographic basis, the United States, the largest services market, grew by 4.3%, slightly higher than the market rate, while Western Europe, the second largest market, grew only by 2.6%. The effect of the trade war will also not be felt until the end of this year or in 2019; therefore, it had no negative impact on services spending in 1H18, according to IDC. In Western Europe, most major vendors are showing some softness in the region. The newcomers’ (namely Indian services providers) expansion into Europe also cooled slightly, with vendors posting mixed results in the region depending on their customer industry mix. In emerging markets, Latin America, Asia/Pacific (excluding Japan) (APeJ), and Central & Eastern Europe led in growth. In Latin America, most major economies are turning the corner despite problems in Argentina and Venezuela.
This growth reflects a relatively positive economic outlook during the first half of this year with accelerated digital transformation and, in some pockets, new digital services offsetting the cannibalization of traditional services.
Epson Introduces Print-as-a-Service Program for SMB-Focused Resellers
Epson America, a Long Beach, California-based printer vendor, has rolled out “Cornerstone,” a new print-as-a-service program for VARs selling to small and medium-sized businesses. The program is designed to help resellers build long-term relationships with customers, capture the full end user system revenue and margins, while reducing overall costs to the channel.
Using a web portal, VARs can generate a three-year print agreement for the latest business class of Epson inkjet printers, including a limited full-term warranty and automatic supply delivery. The partner receives the full revenue and margin for all hardware and warranty upfront as well as the full value of ink over the term of the agreement. The program also provides billing, service and logistics support, reducing the reseller’s operating expenses.
“With the market trends shifting from selling devices to selling services, resellers are looking for tools that ensure they retain the long-term relationship with their end users while also receiving the full value of that relationship, especially IT VARs that are currently selling on a transactional basis and may not have the ability to maintain ongoing service and support,” said Larry Trevarthen, director of business imaging at Epson.
Cornerstone is available in the U.S. through Synnex.
Cornerstone is designed to help Epson’s authorized BusinessFirst resellers expand their business relationships and grow their revenue by selling higher value products.
D&H Distributing to Carry Fujitsu’s High-Performance Scanners with Bundled Document Capture Software
D&H Distributing has signed a new agreement with Fujitsu Computer Products of America through which the Pennsylvania-based distributor will carry select models from Fujitsu’s line of sophisticated desktop scanners, including the flagship ScanSnap iX1500 duplex scanner, and the iX500 color scanner with Nuance PDF management software.
“We’re thrilled to welcome Fujitsu to the D&H fold,” said Peter DiMarco, vice president of VAR sales at D&H Distributing. “Our VAR customer base will be happy to include this productivity-boosting solution in their portfolios, enhancing their value proposition for SMB customers.”
“Partnering with D&H will allow Fujitsu Computer Products of America, Inc. to expand its reach with SMB VARs and traditional retailers making a transition to an omni-channel offering,” said Jeff DeCarlo, senior vice president of sales and corporate strategy at Fujitsu. “Together we are providing D&H’s channel partners with a family of high quality and competitively priced scanners that will enable them to generate revenue, and take advantage of the digital transformation taking place in IT.”
This alliance will likely open Fujitsu scanners to a wider variety of channel partners.