Gartner has said that as companies attempt to implement more multisourcing agreements, the number of megadeals awarded to a single service provider has declined. Mega deals are characterized as being worth more than $1 billion.

In 2005, 11 outsourcing mega deals were awarded, a decline from 12 in 2004 and 16 in 2003. Although the contract value of individual outsourcing deals continues to decrease, Gartner said that there will be more of them, and they will drive the outsourcing market to a growth rate of 7.3% from 2004 through 2009. The uptake in outsourcing as a business tool will continue, and ITO will experience mature growth in 2006 at 5.1%, while the less-mature BPO market will grow faster at 8.7% in 2006.

According to Gartner, Western Europe’s share of total outsourcing deals has steadily increased from 25.9% in 2003, to 31.7% in 2004, to reach the top region in 2005 accounting for 39.6% of the worldwide market. From 2003 to 2005, the number of mega deals signed in Western Europe was more than 50% higher — both in terms of the number of deals and the contract value. In total between 2003 and 2005, Western Europe had 21 megadeals compared to 14 in North America.