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Rafa³ Szajewski
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The Polish IT market is the second largest market in the East-Central Europe, after Russia.In 2010 the initial estimates assessed its amount at PLN 25 billionr epresenting a 3% increase in comparison to 2009, which was less optimistic for the industry. According to the 2011 forecast, the market value is projected to increase to ca. PLN 28 billion to re-establish the two-digit dynamics.
Why is it worth to invest in this sector in Poland? On the one hand, it is worth due to the rapidly developing market and the increase of domestic demand. On the other hand, however, the presence of such global companies as Microsoft, HP, Google, Oracle, IBM or SAP confirm the increase of Poland’s significance not only as a place of selling products and services.
The reason for Poland’s success as the more and more valuable destination for IT services centre is most of all the availability of employees. Our unique and the most valuable resource - people - is still available, and Polish experts provide services for foreign clients more and more often.
Since 2009, when mathematics was re-established as a compulsory subject at high school final exams, the growing interest in technical majors has been observed among students. The increased activity of the Ministry of Science and Higher Education also contributes to the development of human resources – thanks to the grants for the so-called ordered specialities, the universities were additionally motivated to make technical majors’ teaching programmes more attractive, and to increase the number of students.
Another,equally important factor determining Poland’s international recognition is the quality of provided services and the level of creativity that repeatedly exceeds employers’ expectations. Year by year the young Polish computer scientists take the highest positions in international competitions for computer programmers, such as ImagineCup, Code Jam and Central European Programming Contest (CEPC).
The availability of the high-quality communication infrastructure, both in terms of air connections and broadband infrastructure – comparable with that of Western Europe – underlines the benefits of investing in Poland.
Last but not least – attractiveness of Poland is strengthened by labour costs. It is not low wages that account for long-term competitive advantages any more. Still, labour costs being 3 to 4 times less of that in Western Europe combined with the high quality of service and increasing labour productivity complete the image of Poland as THE destination.
The most popular IT services centres are at the same time the biggest Polish academic centres – providing direct access to the most important assets, i.e. employees.
The increase of IT market value until 2014 should be two-digit. Rapid development of IT industry in Poland is a result of lower level of market saturation with personal computers and IT services than in the Western Europe. Another factors contributing to it are increasing purchasing power, and relatively low level of IT-based solutions usage in companies. Also the significance of commissioning services to specialised entities is considerable for the increase of expenditures for both software and IT services, particularly with regard to outsourcing.
Specific factors stimulating the market in the nearest future cover: privatisation of companies and, thereby, unblocking decisions concerning the implementation of IT solutions in order to increase competitiveness, activation of central administration and self-governments in terms of public sector tenders. Another stimulating factor is the growing significance of the role of the sector of small and medium-sized enterprises in generating the demand for IT services and solutions that, in order to increase their competitiveness, are forced to boost the efficiency of their activities through the application of tools management support software and enterprise resource planning. The above-mentioned factors, in the face of experts’ shortage in the Western European economies, will determine Poland’s investment attractiveness in this sector in the forthcoming years.
The level of employment in the IT sector in Poland in 2010 amounted to ca.100 thousand employees (without consideration of distribution network). Due to the rapid increase of outsourcing services provided for non-IT companies, further dynamic increase in employment should be expected.
As a result of the global crisis, in 2009 the hardware segment, understood as computers, monitors and peripheral devices, suffered the most since its value decreased by 19%.At the same time, this segment is expected to recover in the next two years. Its growth in 2010 is estimated at 5%.The segment’s share amounted to ca. 42% with slight downturn in the last years. The second largest segment was the IT services segment with the share amounting to 35%, and the third largest was the software market with ca.22% of market share.Growth in the services and software market in the forthcoming years will be steady.Following the period of recovery in 2011-2012, growth in the IT hardware market will be slower than in the case of the two other segments.
The inflow of foreign investments and relocation of production to Poland are also the important factors generating demand for software for both process and discrete production industry. After the crisis, many companies by mid-2010, in spite of earmarked funds, withheld decisions concerning the expenditure on IT culture.This trend was reversed in the second half of the year.Another factor was the slight increase of expenditure for hardware generated by households with the growing purchasing power and caused by the further decrease in the prices of computers and peripheral devices (printers, scanners, etc.).Another market development factor coversthe inflow of EU funds to the companies that will generate demand for IT solutions through the expenditure for the improvement of infrastructure and trainings for employees.The Operational Programme Innovative Economy funds are particularly significant in this field.
Industries that, due to their expenditure, have contributed to such a high level of IT market growth in Poland for several years include:
The important trend in the IT market is the rapidly growing interest in software and IT services in the sector of small and medium-sized enterprises.On the one hand, the growing competition makes this segment of clients apply innovations and IT support of their activity. On the other hand, lowering prices of business applications determines greater accessibility for clients who up to now could not afford to buy expensive ERP solutions (enterprise resource planning).
The following feature of the Polish IT market is directly connected to the above-mentioned trend. At present, 90% of ca. 11,000 IT companies (2009) hire ca. 9 employees on average. Medium-sized enterprises (50 to 249 employees) constitute almost 10% of all companies, while there are ca. 80 companies with the number of employees exceeding 250.However, the decreasing margin and growing competition from foreign companies have an influence on the consolidation trend among companies.
At the same time, companies of Polish origin locate their investments in the foreign markets: Asseco, Comarch and Ericpol are companies with well-established position in the entire region of Central and Eastern Europe. |
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