Despite good results from Technology One and Mincom, Australia's leading software developers still believe they are up against a government that is too reluctant to buy local and too slow to support research and development.
According to Technology One's CEO, Adrian Di Marco, Australia's software industry is in the same hole as the rest of the IT industry but state and federal government agencies can make a difference.
"There is a lot that government can do," he said. "The trade deficit on IT is at about $7 billion a year and software is about half of that.
"The government isn't doing anywhere near what it should be doing to support the local software industry. They are too complacent and too happy to buy software from multinationals, which sees profits, revenues and job opportunities going overseas.
"In this sort of environment, it is just criminal."
Di Marco believes "there is any number of local software companies that can provide software solutions to the government", yet they still buy from multinationals that are "no cheaper and no better supported".
Alan McElrea, Mincom's CEO and managing director, is also critical of government policy. While he is prepared to see the best software selected for the individual solution that is required, regardless of its origins, he feels this "does not appear to be happening".
"I think the government selection process requires an overhaul," McElrea said. "My concern about the government's role in purchasing software is that these decisions are sometimes made at very low levels of government departments. All of the issues are not necessarily considered."
McElrea believes that too many public servants engaged in software assessment are fooled by the hype of well-marketed foreign companies and "they make decisions based on what is hot" as opposed to what is best.
"I doubt that any evaluation team goes into the process with that as a conscious bent but that is what happens," he said. "It is a big problem in software selection, by government departments in particular."
It is not just the enterprise application software developers in the local industry that are stifled by government. David Warmuz, managing director of Trellian Software, a Melbourne-based search engine technology developer, said he gets no support at all from the government.
"There are a number of different ways in which to get grants," Warmuz said. "The only problem is that it takes too much organising and they request too much information.
"As a privately held company, we don't want to disclose too much information because once you get the grant, all that information has to go public so that the government is accountable for how they spend money."
Warmuz said that despite only 1 per cent of Trellian's sales being in Australia, he is convinced that the company can continue to develop locally and sell internationally, despite the lack of government support.
"The opportunity for us is overseas," Warmuz said.
Not all local developers are critical of the government. Graeme Barty, founder and director of Perth-based HarvestRoad, said he thinks the government is doing "everything it should be" to promote and support Australian software, with grants, incubation facilities and export missions.
However, he also agrees "there is a hesitancy by local IT managers" to buy locally. "There needs to be more risks taken by IT managers on locally produced software," Barty said. "In these tougher times, some of the foreign software is not nearly as well supported as it once was."
"There are two ways of looking at it," Whalley said. "You can always be anti-government, or you can look at policy change and view it as an economic cycle, which helps us software developers because customers are forced to re-evaluate their business.
"A change in the way they do business means a change in their processes and systems, which means a change in the software they use. That is a positive."