Technology & Innovation

Asia competition barometer: IT services

February 24, 2012

Asia

February 24, 2012

Asia
Our Editors

The Economist Intelligence Unit

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A

Research Methodology

This report focuses on the Barometer findings for the information technology (IT) services sector. Assessing a universe of 296 IT services companies that are publicly listed in eight countries—China, India, Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam—the Barometer examines changing profitability and the competition landscape for the IT services sector.

The Barometer has two dimensions: profitability and market concentration. To assess the aggregate profitability of the IT services sector in Asia, the EIU developed a composite index of five ratios that each represents a different aspect of a company’s profitability. To assess market concentration, the EIU calculated the Herfindahl-Hirschmann Index (HHI) for the IT services sector in Asia from 2004 to 2009. A measure of the size of companies in relation to the industry, and an indicator of the amount of competition among them, the HHI is defined as the sum of the squares of the market shares of the 50 largest firms from the universe of 296 listed companies assessed.

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