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Byline: J. BONASIA
Providers of information technology services may need to catch their breath after 2002. It was a year of wrenching change that transformed the industry.
In the year's biggest news, IBM Global Services swallowed rival PricewaterhouseCoopers Consulting. IBM wasn't the only one making big moves. Hewlett-Packard Co., Dell Computer Corp. and others scrambled to expand their service offerings. And tech consulting firms continued to distance themselves from auditors.
Services have become a crucial part of the high-tech world. Back in 1982, they made up just 26% of total IT spending, says SoundView Technology Group. Today, services comprise 40% of IT spending.
"This year marks an inflection point for maturation of the IT services industry," said Tom Rodenhauser, president of Consulting Information Services LLC in Keene, N.H.
IBM dropped a bomb on the sector in August. That's when it said it would purchase PwC Consulting for $3.5 billion in cash and stock. The deal closed in October.
PwC Consulting brought some prized strategy consulting skills and blue chip clients to IBM. The move did away with PwC Consulting -- a major competitor -- thereby cementing Big Blue's perch atop the IT service heap.