ISG
The European market for IT and business services remains robust, with record demand for cloud-based services in the first quarter and continued strength in managed services, according to the latest state-of-the-industry report from Information Services Group (ISG ) (Nasdaq: III ), a leading global technology research and advisory firm.
The EMEA ISG Index™, which measures commercial outsourcing contracts with annual contract value (ACV) of US $5 million or more, shows ACV for the combined market, which includes both as-a-service and managed services, reached US $6.0 billion, up 20 percent year on year, but off 5 percent from a record fourth quarter.
Cloud-based as-a-service ACV reached a quarterly record of US $2.5 billion, up 16 percent versus the prior year. Within this segment, infrastructure-as-a-service (IaaS) climbed 19 percent, to a record US $1.8 billion, while software-as-a-service (SaaS) rose 9 percent, to a record US $658 million.
Managed services, meanwhile, produced its second straight strong quarter, with ACV of US $3.5 billion, up 23 percent year on year, fueled by growth in both IT outsourcing (ITO) and business process outsourcing (BPO) and strong results in the UK, France and DACH. ITO was up 17 percent year on year, to US $3.0 billion, on strength in both ADM and infrastructure services, while BPO surged 66 percent, to US $521 million, on strong demand for industry-specific, finance and accounting, and engineering and R&D services.
“EMEA has produced two consecutive quarters with US $6 billion or more of ACV, adding more than US $1.4 billion from its pandemic low,” said Steve Hall, president, ISG EMEA. “Importantly, the region is seeing strength in both the as-a-service segment, as more and more enterprises adopt a public or hybrid cloud strategy, and on the managed services side, which is experiencing a resurgence.”
Hall pointed out that three of the four mega-deals (those with ACV of US $100 million or more) in the first quarter were awarded in the EMEA region. “That brings the total to eight mega-deals over the last two quarters; you have to go back to early 2017 to find a two-quarter period in EMEA that had more mega-deals awarded.”
Among significant IT awards in the first quarter, Mphasis contracted with Ardonagh Group, the U.K. independent insurance broker, to support its digital transformation. On the infrastructure side, Atos won a large digital workplace contract with telecom company Wind Tre in Italy, and HCL inked a five-year digital workplace services agreement with Airbus, the European aerospace manufacturer.
Within the BPO space, KPIT signed significant engineering services deals with BMW and automotive technology company Veoneer to support work on autonomous driving and intelligent mobility. ISS Group, meanwhile, secured an eight-year extension with Barclays in the U.K. to provide integrated facility and workplace services across the bank’s operations in 30 countries.
With the automotive sector becoming a battleground for major public cloud providers, BMW Group announced it is migrating workloads to AWS, joining automakers Renault and Volkswagen on AWS. In the travel sector, ISG advised on one of the biggest cloud deals in the region this quarter with the signed agreement between global travel technology company Amadeus and Microsoft Azure.
In the SaaS segment, Microsoft signed deals this quarter with Daimler, GlaxoSmithKline and IKEA, while Oracle secured contracts with NatWest Group to standardize its various banks on Oracle Fusion in the cloud.
Market Insights
The DACH market generated more than US $1 billion of managed services ACV in the first quarter, up 13 percent over the prior year. It was the second consecutive quarter DACH ACV was above US $1 billion mark—about a third higher than its historic norm. DACH now accounts for nearly 30 percent of managed services ACV in the EMEA region.
Managed services ACV in the UK reached US $866 million, up 20 percent over the prior year. It was the fourth consecutive quarter the UK generated managed services ACV in excess of US $800 million, represented a sustained rebound for the market, but still below the US $1 billion quarters that were typical prior to 2017 and the onset of Brexit uncertainty.
France, meanwhile, had its best ACV quarter since 2014, with managed services ACV of US $595 million, up nearly 2.5 times from US $243 million in the prior year, with nearly 40 deals reached in the quarter.
2021 Global Forecast
ISG is forecasting the global market for cloud-based services (IaaS and SaaS) will grow 18 percent in 2021, down slightly from its 20 percent forecast at the start of the year. ISG, meanwhile, has raised its growth forecast for managed services to 5 percent, up from 3 percent at the start of the year.
About the ISG Index™
The ISG Index™ is recognized as the authoritative source for marketplace intelligence on the global technology and business services industry. For 74 consecutive quarters, it has detailed the latest industry data and trends for financial analysts, enterprise buyers, software and service providers, law firms, universities and the media. In 2016, the ISG Index was expanded to include coverage of the fast-growing as-a-service market, measuring the significant impact cloud-based services are having on digital business transformation. ISG also provides ongoing analysis of automation and other digital technologies in its quarterly ISG Index presentations.
For more information about the ISG Index, visit this webpage .
About ISG
ISG (Information Services Group) (Nasdaq: III ) is a leading global technology research and advisory firm. A trusted business partner to more than 700 clients, including more than 75 of the world’s top 100 enterprises, ISG is committed to helping corporations, public sector organizations, and service and technology providers achieve operational excellence and faster growth. The firm specializes in digital transformation services, including automation, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; strategy and operations design; change management; market intelligence and technology research and analysis. Founded in 2006, and based in Stamford, Conn., ISG employs more than 1,300 digital-ready professionals operating in more than 20 countries—a global team known for its innovative thinking, market influence, deep industry and technology expertise, and world-class research and analytical capabilities based on the industry’s most comprehensive marketplace data. For more information, visit www.isg-one.com .
View source version on businesswire.com: https://www.businesswire.com/news/home/20210413005463/en/
Link:
Social Media:
About Business Wire
Subscribe to releases from Business Wire
Subscribe to all the latest releases from Business Wire by registering your e-mail address below. You can unsubscribe at any time.
Latest releases from Business Wire
Xsolla Expands Payment Coverage in Portugal With MB Way, a Leading Mobile Wallet Trusted by 6 Million Customers, to Unlock New Growth Opportunities for Game Developers20.1.2026 16:41:00 CET | Press release
Empowering Portuguese players with Seamless, Localized Payment Options for a Smoother and More Trusted Gaming Experience Xsolla, a global video game commerce company that helps developers launch, grow, and monetize their games, today announced the expansion of its payments solution in Portugal with the addition of MB Way. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20260120938007/en/ Graphic: Xsolla Portugal is a leader in digital transformation, with nearly 90% of its population online, high smartphone usage, and a strong adoption of mobile banking. Trusted by 6 million people, connected to 11 million cards, supported by 28 banks, and driving 496 million transactions in 2024, MB Way provides 95% market coverage, allowing most bank customers to use the service. MB Way is the leading mobile wallet in Portugal, with an estimated market share of 34%-45% of all e-commerce transactions locally. By adding MB Way as a payment meth
Balena Secures Strategic Growth Investment to Accelerate Edge AI and IoT Fleet Management20.1.2026 15:14:00 CET | Press release
New partnership fuels product innovation and reinforces Balena’s position as the leading hardware-agnostic platform dedicated to the security and long-term stability of device fleets Balena, the leading platform for deploying, managing, and scaling fleets of edge computing and AI devices, today announced a strategic growth investment from LoneTree Capital (“LoneTree”), a New York-based growth capital firm. The partnership will accelerate Balena’s product innovation with a focus on Edge AI workloads and security features to meet evolving compliance needs, while expanding resources for customer success and global fleet support. Founded in 2011, Balena enables customers to leverage the ever-increasing power of technology to solve real-world problems by providing software to manage the full lifecycle of edge computing devices. The platform abstracts away infrastructure complexity, handling critical tasks like secure Over-The-Air (OTA) updates so engineering teams can focus on their core pr
SIRBAI Launches Middle East’s First AI-Powered Autonomous Drone Swarm Technology at UMEX 202620.1.2026 15:11:00 CET | Press release
New platform enables coordinated, autonomous drone operations designed for modern defense environments SIRBAI today announced the official launch of the Middle East’s first AI-powered autonomous drone swarm technology at UMEX 2026 - a global exhibition platform for unmanned systems and autonomous capabilities - marking the company’s entry into the defense technology sector. Designed for unmanned aerial systems (UAS), the platform enables multiple drones to operate collaboratively with a high degree of autonomy, even in complex and contested environments. As the first company in the region to offer this advanced capability, SIRBAI is set to redefine the modern battlefield with innovative and scalable autonomous technology, establishing new standards for resilient and operator-friendly mission systems for modern defense operations. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20260120186459/en/ SIRBAI Launches Middle East’s Fi
FlightSafety International Receives EASA and UK CAA Certification for Gulfstream G700 Flight Simulator at Farnborough Learning Centre20.1.2026 15:05:00 CET | Press release
Certification advances training support and builds on FlightSafety’s decades-long partnership with Gulfstream Aerospace Corp. FlightSafety International Inc. (FSI), a global leader in aviation training and simulation technology, announced today it has received European Union Aviation Safety Agency (EASA) and UK Civil Aviation Authority (CAA) certification for its Gulfstream G700 Full Flight Simulator (FFS), located at the company’s Farnborough Learning Centre. The certification of the simulator, which was engineered and manufactured by FSI, validates the advanced technology, accuracy, and fidelity of the flight training device, confirming it meets the highest European and UK regulatory standards. The FFS will be leveraged for initial, recurrent, and advanced pilot training to support G700 and Gulfstream G800 aircraft, further expanding global access to high-fidelity training. “The G700 simulator certification in Farnborough reinforces FSI’s long-standing commitment to supporting Gulfst
OPEX® and Peltier Partner to Deliver First-of-Its-Kind Cold Storage Solution for Automated Fulfillment Systems20.1.2026 15:00:00 CET | Press release
OPEX® Corporation, a global leader in Next Generation Automation providing innovative solutions for warehouse, document and mail automation, today announced a strategic technology partnership with Peltier, an innovator in cold chain commerce, to offer a first-of-its-kind, multi-temperature zone, multi-deep cold storage solution for automated fulfillment systems. This collaboration introduces advanced multi-temperature capabilities to OPEX Corporation’s industry-leading Perfect Pick® and Infinity® automated storage and retrieval systems (ASRS), empowering customers in the grocery, pharmaceutical, and life sciences markets to seamlessly store and retrieve chilled and frozen products utilizing Peltier’s actively cooled, AI-enabled totes, eliminating the need for costly freezer chambers or specialized infrastructure. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20260120776429/en/ OPEX iBOTs efficiently transport and present Pelt
In our pressroom you can read all our latest releases, find our press contacts, images, documents and other relevant information about us.
Visit our pressroom