United Kingdom IT Services Market Size

UK IT Services Market Analysis

The United Kingdom IT services market is expected to register a CAGR of 10.36% during the forecast period. The increasing use of internet applications and services, as well as the growing availability of wireless devices such as smartphones, other smart gadgets, and associated apps, are significantly driving the growth of the United Kingdom IT service market.

• There has been a significant investment in various IT solutions in the United Kingdom, with the overall adoption of software-as-a-service (SaaS) and increased cloud-based products demonstrating the rising industry's requirements for IT services. Digital transformation and automation are also trending in the region, fuelling the demand for IT services.
• Many prominent SaaS companies have ventured into the UK, where the market is expanding. SaaS growth is mainly fuelled by regional technology advancements, like adopting artificial intelligence and machine learning. The country's SaaS market is still maturing, offering investors a broad scope of opportunities to invest in IT solutions. For example, In March 2022, Amazon Web Services intended to invest more than £1.8 bn (USD 2.2 billion) over the next two years in building out its overall UK datacentre presence, as the demand for its public cloud services continues to increase significantly. During the intervening years, its presence in the UK has allowed AWS to secure many lucrative and high-profile deals with private sector organizations and central government departments in the financial, healthcare, and pharmaceutical services sectors.
• Moreover, the market is witnessing various mergers, partnerships, and acquisitions. For instance, in October 2022, Arqit Quantum Inc., a provider of quantum-safe encryption, signed a contract with Nine23 Ltd, a cyber security solutions provider primarily for the UK-compliant and regulated sectors, to deploy Arqit's QuantumCloud. It is mainly a symmetric key agreement software on Nine23's UK Sovereign Secure Private Cloud infrastructure, Platform FLEX, to deliver the highest level of assurance for its clients and customers.
• However, the rise in various data security-related issues and data breaching risks in the region could be a significant factor, restricting the overall market's growth throughout the forecast period.
• COVID-19 had a significant impact on the UK IT service industry sector. Working techniques of the companies changed to remote working scenarios for which demand for cloud computing services increased. Companies shipped computers to employees' homes and made them equipped with Wi-Fi adapters, power backup sources, and broadband connections when the IT companies began allowing employees to work from home. The virtual private network bandwidth was increased, and backend capacity was increased to meet the increased number of concurrently connected remote users. Virtual working was made possible because of cloud-based remote access solutions. Thus, the market initially faced challenges during the pandemic, but gradually COVID-19 had a good impact on IT services because of the increasing service needs.