The financial services sector drove the UK outsourcing market to record levels in the first half of 2017, with big firms signing major IT contracts.
Of the £5.2 billion in outsourcing deals struck in the first six months of the year, £2.9 billion - 55%, - came in the FS industry, compared to just £428 million in H1 2016, according to the Arvato UK Outsourcing Index.
Much of this spending was on IT, with private sector contracts in this area worth £3.8 billion during the period. The FS industry was responsible for the vast majority of this, with security a major driving force as firms ramped up spending on network infrastructure, security architecture and cloud computing.
Lloyds Bank alone agreed a £1.3 billion, 10-year mega outsourcing deal with IBM in June which will see 1500 staff and contractors moved to Big Blue.
Patrick Quinn, CEO, Arvato Financial Solutions UK & Ireland, says: "Strengthening security and data protection are top of the agenda for the sector and businesses are increasingly turning to partners to deliver resilient infrastructure and architecture in the wake of high profile cyber-attacks and to prepare for the new data privacy legislation."
One outsourcing area that has emerged as a concern in recent days is the FS industry's reliance on Amazon Web Services. Citi, HSBC and JPMorgan are among the big banks to use AWS, prompting a discussion on the Hacker News forum about how a data centre could prove a tempting target for terrorists or hostile states.
"If you wanted to blow something up to make the west suffer, an AWS datacenter would probably be a pretty good target. I wonder at what point that becomes a legitimate national security concern, and the government steps in to provide protection," writes one contributor.