Decoding the cause of IT's struggles: why clients are bringing outsourced work back in-house

The market for third-party IT services companies is facing challenges as more organizations are bringing their outsourced technology work back in-house. Leading Indian software exporters like Tata Consultancy Services (TCS), HCLTech, and Cognizant, as well as multinational firms such as Atos, have experienced a decline in business recently due to this trend. This shift, often referred to as 'insourcing'—the opposite of outsourcing—has started to significantly impact the addressable market for third-party IT service providers. The reduction in outsourced contracts has affected major Indian IT firms and global companies alike, highlighting a growing preference among businesses to manage their technology needs internally.