Information Services Group, Inc. reports developments as a global AI-centered technology research and advisory firm serving enterprise technology and business-services markets. The company publishes research on digital transformation, AI adoption, sourcing, cloud and data analytics, provider ecosystems, governance, risk, software, network and technology strategy.
Recurring news includes ISG Provider Lens® studies across industries such as healthcare, life sciences, aerospace and defense, automotive and mobility, SAP ecosystems and global capability centers. Company updates also cover quarterly results, GAAP and non-GAAP performance measures, advisory-market trends and the role of AI, automation, data platforms and managed services in enterprise operations.
The 2024 ISG Provider Lens™ report reveals a 30% increase in managed cloud services, hosting, and colocation usage by U.S. public sector organizations since 2020. This surge follows pandemic-driven digital transformations and is expected to continue as agencies seek cost-effective management of complex IT infrastructures. ISG predicts a 15% annual growth in managed cloud services use through 2027.
Key trends include:
- Adoption of hybrid cloud models for diverse workloads
- Providers offering tailored services for public sector needs
- Increased use of managed hosting for IT support
- Surge in colocation services for enhanced security and compliance
The report evaluates 38 providers across three quadrants: Managed Services, Managed Hosting, and Colocation Services, with several companies named as Leaders in multiple categories.
The 2024 ISG Provider Lens™ report highlights increasing demand for cloud management services in Switzerland due to the growing complexity of multicloud solutions. Swiss enterprises are turning to colocation providers for improved security, compliance, and global connectivity. The report emphasizes the importance of sustainability, with Swiss data centers required to achieve carbon neutrality by 2030.
Key findings include:
- Switzerland is a leading nation in Europe for managed hybrid cloud services
- Competition between hybrid IT and colocation service providers is intensifying
- Small and midsized providers are gaining customers from large global system integrators
- Swisscom named as a Leader in all five quadrants of the report
The Asia Pacific IT and business services market surpassed US $5 billion for the first time in two years, according to the latest ISG Index™. The combined market ACV rose 8% year-over-year to just over US $5.0 billion in Q2 2024. Managed services saw a significant boost, with ACV climbing 32% to US $1.4 billion, marking the region's best quarter in 12 years. Cloud-based services (XaaS) grew 1% to US $3.6 billion.
Key highlights include:
- 81 managed services contracts awarded, up 37% year-on-year
- IT outsourcing (ITO) ACV rose 8% to over US $1 billion
- Business process outsourcing (BPO) surged 237% to US $367 million
- Strong demand in South Korea, China, and Japan
- Manufacturing, telecommunication, and energy sectors showed growth
The 2024 ISG Provider Lens™ global Life Sciences Digital Services report highlights a significant shift towards decentralized clinical trials in the life sciences industry. Digital technologies are enabling remote patient recruitment, monitoring, and data collection, addressing limitations of traditional centralized trials. AR and VR systems are being introduced to enhance patient participation and data visualization.
The report emphasizes the growing focus on patient-centric research and the use of AI, automation, and NLP in pharmacovigilance and regulatory compliance. Generative AI is emerging as a important tool for improving research and trials. The report also notes the increasing importance of supply chain management and collaborative approaches to regulation in the industry.
The Americas' IT and business services market rebounded in Q2 2023, according to the ISG Index™. Combined ACV rose 10% to $12.1 billion, marking the first double-digit increase since Q2 2022. XaaS spending drove growth, rising 15% to $7.4 billion, while managed services ACV increased 3% to $4.7 billion. The BFSI sector saw an 18% decline in spending, but other industries showed growth. Cloud-based services and AI investments are driving demand, while managed services remain sluggish due to cost optimization focus.
For H1 2023, the combined market rose 4% to $24.2 billion. ISG forecasts 2% revenue growth for managed services and 14% for XaaS in 2024, slightly lower than previous projections. The global market lacks a clear catalyst for higher discretionary spending, with enterprises focusing on cost optimization and AI growth potentially masking underlying weakness in the industry.
European insurers are modernizing core systems to meet growing customer demands and skepticism, according to the 2024 ISG Provider Lens™ Insurance Platform Solutions report. Legacy systems are seen as major obstacles to innovation, restricting adoption of new technologies and leading to increased IT costs and operational inefficiencies.
Insurers are turning to providers to update, upgrade, or replace outdated systems with more efficient solutions. The report highlights the potential for the insurance industry to evolve into a business-friendly ecosystem, with early adopters gaining a competitive edge. Data-driven insights are emphasized as important for identifying new risks and opportunities.
The report evaluates 31 providers across two quadrants: Life and Retirement (L&R) and Property and Casualty (P&C) Insurance Platform Solutions, naming several Leaders and Rising Stars in each category.
The 2024 ISG Provider Lens™ Private/Hybrid Cloud report for the U.S. highlights that cost concerns are driving enterprise investments in private and hybrid cloud services. Many organizations are reducing reliance on public clouds due to IT budget constraints, seeking greater control over costs while maintaining scalability and agility.
Key findings include:
- Companies are cautiously approaching outsourcing with smaller average contract values
- Enterprises are exploring generative AI (GenAI) for cloud management, weighing costs and benefits
- AI and ML features are being implemented to improve IT efficiency and user experience
- Colocation providers are expanding facilities to meet growing demand for high-density computing
- Challenges include the cost and scarcity of AI processing resources and changes in VMware licensing terms
The ISG Index™ reports that Europe's IT and business services market grew slightly by 1% in Q2 2024, reaching US $7.7 billion in ACV. This marks the third consecutive quarter of sequential growth since Q3 2023. The market saw contrasting trends with managed services ACV declining by 8% to US $4.0 billion, while XaaS (cloud-based services) ACV increased by 14% to US $3.7 billion.
Key highlights include:
- 295 managed services contracts signed, up 20% year-over-year
- ITO rose 7% to US $3.3 billion, driven by bundled infrastructure and ADM services
- BPO slumped 45% to US $692 million
- XaaS growth led by IaaS (up 22% to US $2.7 billion), while SaaS declined 2%
- UK remains the largest managed services market despite a 13% decline
- DACH market grew 20% to US $896 million
ISG forecasts 2% revenue growth for managed services and 14% for XaaS in 2024, slightly lower than previous projections due to persistent market uncertainty.
Information Services Group (ISG) (Nasdaq: III) has initiated a research study to evaluate providers of advanced data analytics and AI services. The study will culminate in the publication of the ISG Provider Lens™ reports in January 2025, focusing on data science, AI services, data modernization, and advanced business intelligence (BI) and reporting modernization. The reports will help enterprises assess current vendor relationships, explore new engagements, and leverage analytics and AI to enhance decision-making, operational efficiency, and competitiveness. ISG highlights the increasing importance of clean, secure data and emerging technologies like generative AI (GenAI) in fostering data-driven cultures and innovation. Providers are innovating with frameworks, simulation models, and AI solutions to automate insights generation. The study will cover products and services globally, including Brazil, Europe, and the U.S.
North American insurance companies are modernizing their IT infrastructure by adopting new core systems and SaaS platforms, driven by evolving policyholder demands and rapid changes in industry practices, according to the 2024 ISG Provider Lens™ Insurance Platform Solutions report. The report highlights that outdated IT systems are impeding insurers' ability to innovate and compete. SaaS platforms and modern tech frameworks help insurers manage risks, acquire customers, and enhance policyholder services. However, integration with legacy systems poses challenges. The report also notes the potential of generative AI to improve insurance operations, though it is currently in the pilot phase. Major insurance providers like EIS and Majesco are recognized as leaders, while companies like Accenture ALIP and Guidewire are also notable players. The report underscores the importance of data modernization and the elimination of data silos.