There may be more IT outsourcing contract disputes as a result of the credit crunch, it is reported.

Law firm Pinsent Masons has warned the increasing financial uncertainty is likely to lead to more renegotiations of outsourcing contracts, ComputerWeekly.com says.

In addition, it suggests major long-term projects might be delayed or even abandoned as organisations prioritise short-term cost-cutting over long-term investment.

According to the website, Iain Monaghan, a partner in the outsourcing, technology and commercial group at Pinsent Masons, commented: "Many IT outsourcing deals come under stress during times of financial uncertainty, for example because a better deal could be done in the depressed market or because the anticipated level of expenditure on transformation is no longer sustainable."

The Daily Telegraph website recently reported that technology giants Microsoft and Google are even feeling the effects of the economic downturn.

It said Google had acknowledged that it had been affected by wider conditions in Europe and the US, while Microsoft's sales were lower than had been forecast.

More than half of small businesses (53%) believe that the most important benefit of outsourcing is guaranteed response times for IT support, London based Connect conducted the research in 2007.