ITIL royalty earnings to increase through cabinet-led Capita partnership
The UK government and Capita have announced a groundbreaking joint venture, marking the first of its kind to be spun out of central government. This partnership aims to create a thriving business that will deliver real value to all parties and release a secure and growing income to the government.
Capita secured the contract following a competitive tender, and the joint venture will take over the UK government's best practice framework portfolio, including ITIL and Prince2. The government's equity value in the portfolio is around £100 million, with the potential value of its 49% stake reaching as much as £362m.
The new company will invest in product development to ensure ITIL stays at the cutting edge and improves the offer to IT professionals over time. Capita plans to digitize services and introduce experiential learning methods such as gaming and simulation to enhance the ITIL framework.
ITIL, developed by the government's Central Computer and Telecommunications Agency in the late 1980s, has been a cornerstone of IT service management (ITSM) for decades. ITIL 4, the latest iteration, is a flexible, outcome-focused ITSM framework that integrates well with other methodologies and supports continuous improvement. More than 32% of businesses are actively planning to adopt ITIL 4, signaling sustained growth and strategic shifts toward ITIL-centric service management.
Stephen Mann, an IT service management analyst for Forrester Research, has raised questions about the future of the ITIL framework. Specifically, he questions whether ITIL will be written by Capita and if those who have previously invested time in creating and enhancing ITIL will continue to do so. However, the governance arrangement between the UK government and Capita ensures continued investment and evolution to keep ITIL relevant for public and private sectors alike.
The Cabinet Office states that IT professionals who are qualified in ITIL should notice no difference immediately. The joint venture aims to further enhance the international recognition of ITIL by taking it to new markets and establishing it as the global industry standard.
Capita also plans to broaden the range of training products and markets to sell into, across the UK and worldwide. The deal was brokered by the Cabinet Office's Commercial Models Team, and Capita will pay the government £10 million up front and an annual payment of £9.4 million. The Cabinet Office projects that the combination of payments and dividends could amount to £311m over ten years, with the government currently earning around £80 million a year in royalty revenues from the portfolio.
Despite concerns about the future of the ITIL framework, the joint venture between the UK government and Capita assures ongoing stewardship and development of ITIL, supporting its longevity and modernization in global IT service management practices.
[1] https://www.forrester.com/report/Adopting+ITIL+4+For+Digital+Transformation/-/E-RES141515 [2] https://www.itgovernance.co.uk/blog/itil-4-what-is-it-and-why-should-i-care [3] https://www.axelos.com/best-practice-solutions/itil [4] https://www.itgovernance.co.uk/blog/itil-4-what-is-it-and-why-should-i-care [5] https://www.itgovernance.co.uk/blog/itil-4-what-is-it-and-why-should-i-care
The joint venture between the UK government and Capita will invest in technology, aiming to ensure ITIL remains at the forefront of business and IT service management, with potential value reaching up to £362m. The new company will expand the ITIL framework by digitizing services and broadening the range of training products, targeting both local and international markets.
