50 International Journal of IT/Business Alignment and Governance, 5(1), 50-66, January-June 2014 Copyright © 2014, IGI Global. Copying or distributing in print or electronic forms without written permission of IGI Global is prohibited. ABSTRACT The outsourcing of Information Systems development and maintenance to external and specialized partners is a frequent practice among contemporary organizations. However, outsourcing projects have been proven to be prone for failure. As a result, practitioners and scholars have suggested a variety of outsourcing risk factors which may lead to unsuccessful project outcomes, as well as possible remedies to mitigate them. Empirical studies nevertheless continue to report frequent failures in outsourcing projects. In this paper, the concept of modularity is used as an alternative perspective to analyze risks related to outsourcing projects. Such approach might help in supplementing existing outsourcing risk analyses with new, additional or more profound insights on this topic. It might also serve as an additional basis to list a more exhaustive enumera- tion of required mitigating actions, which in turn could lead to more succesful outsourcing projects. This alternative perspective is illustrated by a reanalysis of a failed outsourcing case which is documented in literature and available court proceedings: the BSkyB case. It is shown in a specifc way how poorly designed modular structures at the technical and project communication and project management level could have been identifed ex-ante. This identifcation may explain the manifestation of ex-post outsourcing risk factors such as ‘lack of required skills’, ‘managing user expectation’, ‘communication problems’, ‘project management’ and ‘signifcant integration requirements’. Understanding Outsourcing Risk Factors Based on Modularity: The BSKYB Case Philip Huysmans, University of Antwerp, Antwerp, Belgium Peter De Bruyn, University of Antwerp, Antwerp, Belgium Shazdada Benazeer, University of Antwerp, Antwerp, Belgium Alain De Beuckelaer, Radboud University, Nijmegen, Netherlands Steven De Haes, University of Antwerp, Antwerp, Belgium Jan Verelst, University of Antwerp, Antwerp, Belgium Keywords: Information Systems, Outsourcing, Outsourcing Projects, Outsourcing Risk Factors, Project Management, Signifcant Integration Requirements DOI: 10.4018/ijitbag.2014010104