Australian ICT companies still keen on exports

Australian ICT companies still keen on exports

Australia’s ICT trade deficit may have plunged from $5 billion to $28 billion last year, but technology exporters have expressed confidence in overseas market action.

Australia’s ICT trade deficit may have plunged from $5 billion to $28 billion last year, but technology exporters have expressed confidence in overseas market action. According to the Australian Computer Society’s (ACS) Australian Trade Update Report 2009, based on data gathered from 2008, ICT exports hit $6.6 billion.

The result put 2008 just behind the peak of $6.9bn achieved in the boom of 2000. The report also showed imports soared to $34bn, with ICT equipment imports totalling $29.7bn. CEO of Sydney-based logistics and freight software company CargoWise edi, Richard White, said it had achieved its best year ever with 60 per cent year-on- year growth. The company began its overseas ventures in 2005.

“When I talk to my fellow software developers both here and in the US, and businesses that are going internationally, I would think the software industry has been one of the most resilient,” he said.

“It is not impervious to the global recession as clearly some people have fallen back, particularly in the services area. So if you are talking about software services, development, programming, integration and that kind of thing, they have taken a hit.

“Those that provide product and have maintenance streams along with software-as-a-service, in worst cases I am hearing 10 per cent down and best case, people with fairly large growth. So the typical case is five per cent growth instead of 15 this year.” ---P--- On the hardware side, Pioneer Computers Australia manager, Jeff Li, said its exporting was going well, with its Chinese business the fastest growing market.

“There are a lot of people in China with medium to high incomes looking to spend money,” he claimed. “We’re looking to release a range of medium to high-end products in the market as a result.” Pioneer is also seeing strong business in Brazil following its entry into the market earlier in the year.

“In Brazil, the Government protects the local industry, so there’s not such a multinational presence there,” he said. “This has left the market with some holes we have found opportunities in.” For virtualisation software vendor, NetLeverage, the downturn made generating activity with overseas exports a challenge. But it has undertaken a number of marketing activities to create interest.

“Something we have found to work is to offer free products available for download over the Internet, which helps get out name out there,” NetLeverage CEO, Steven Hasani, said. Different regions have different requirements in developing a presence, he said, and being on the ground is a requirement in the US for winning business. In other locations, NetLeverage can rely more on a reseller channel.

The vendor has also worked with organisations such an AusTrade to win additional contracts, such as education rollouts in Brazil.

“One big concern we have with some customers is in not being physically present to deliver software,” Hasani said. “With time difference issues, it creates risk management concerns that we can mitigate through product trial offers and automated Web-based support.

“We have lost business to overseas local organisations as a result, of course. As a small company, we need to work hard to capture the imagination of CIOs.”

The recent ACS report on ICT exports also found goods and services were among the top 10 principle exports for the country. The industry contributed to almost 2.3 per cent of Australia’s total export earnings. The most lucrative markets included New Zealand, the US, China, Germany and Singapore.

ICT services exports were particularly strong in the US, Hong Kong, UK, New Zealand, Singapore, Japan and China. ACS chairman, Kumar Parakala, said continued proliferation across the sector offered growth opportunities for Australia’s economy. “We need to pay more attention to this sector and make it a national economic priority,” he said. However, Parakala expressed concern over the country’s ICT huge trade deficit and claimed Australia was lagging behind other developing countries in terms of producing, commercialising and marketing ICT innovations.

“Our businesses do not seem to be effectively tapping into global networks,” he said. According to the ACS, Australia mainly sources goods from China, the US, Malaysia, Japan, Korea, Singapore and Germany, while China is a big player in hardware, supplying 35 per cent of Australia’s imported ICT equipment.

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