Outsourcing to cost US carriers $14 trillion

A new market research report from Californian analysts Insight Research has revealed the magnitude of the outsourcing market.

The study showed that US wireless carriers will spend almost $1.4 trillion on outsourcing over the next five years, in an attempt to maximise profit potential.

Robert Rosenberg, president of Insight comma said that the growing popularity of VoIP had forced businesses to consider outsourcing.

"Before the advent of VoIP, outsourcing was used by carriers to gain incremental cost improvements in the ten to 20 per cent range," he noted.

"However, the lower margins associated with IP communications as well as increasing competition are forcing carriers to rethink their entire strategy. Carriers are unbundling their value-chain and using outsourcing as a transformational strategy to achieve cost savings between 30 and 60 per cent."

The report added that the impact of VoIP will be visible as early as the end of 2007.

It predicted that wireless carriers will have spent more than $198 billion on outsourcing service[s?] worldwide.

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