New York, May 16 (IANS) Revenues of IT companies have been growing at a healthy rate but US-based firms witnessed higher revenue growth than their Indian counterparts.

While revenue of Indian IT companies grew 38 percent in 2007, US-based service vendors posted 55.

4 percent revenue growth, according to a report by Gartner, an IT research and advisory firm based in Connecticut.

IT services revenue worldwide amounted to $748 billion in 2007 (Rs.31.94 trillion), a good 10.5 percent increase from 2006.

In India, the domestic IT services market grew 18 percent in the same year (in rupee terms), outperforming overall Asia-Pacific growth rate in the sector, the Gartner report stated.

'While cost remains a key consideration in the outsourcing services market in India, operational efficiency and business agility is driving most IT services engagements,' said Arup Roy, senior research analyst at Gartner.

The report added that vendors headquartered in India are ranked lower than the top 20 but performed well as a group in 2007, with a growth rate of 38 percent. This is more than three times the market average.

Tata Consultancy Services (TCS) is the highest-ranked Indian provider at No.28 in the world.

Across all IT services, IBM continued to be the global market leader, dominating 7.2 percent of the market. IBM and Accenture reported strong growth rates of respectively 12.2 percent and 19.7 percent.

'This strong growth, combined with strong first quarter results for market leaders, runs counter to the gloomy and widespread economic concerns arising in the US,' said Kathryn Hale, research vice-president, Gartner's worldwide IT services group.

'To build on their success in 2007, service providers should focus on selling services that will deliver visible returns in 2008, either in cost, speed to market, or business impact. Apart from that, they should also focus on growing sales in emerging markets that enjoy faster-growing economies and high growth rates,' Hale said.