The Romanian market for IT services grew a healthy 28.3% to $167.81 million in 2004. According to new IDC study, a combination of economic growth, large privatization deals, and vertical market development spurred investment in IT services. The Romanian IT services market should expand by an annual average of 16.8% over the next few years, eventually reaching $365.20 million in 2009.
There was a considerable shake-up in the vendor rankings on the Romanian IT services market last year. S&T jumped from sixth to first, SIVECO fell from first to third, and new entrants Softwin, Forte, and Romysm Consulting all cracked the top ten. IBM held on to second position while HP dropped a notch to fourth. Despite the shuffle, the market further consolidated in 2004, with the top ten vendors representing just under 70% of market revenue, up from 60% in 2003.
"Although three new vendors broke into the top ten,' says Laurentiu Popescue, Branch Manager, IDC Romania, 'it would be foolish to think that this is easy. The market is healthy and growing, but the rankings shuffle and consolidation also point to intense competition. To get a slice of the IT services pie while not spreading themselves too thin, vendors should consider partnering with specialized agencies. This may mean less revenue, but it helps set the stage for long-term success.'
Systems integration was the largest single area in the IT services market in Romania in 2004. Hardware support and installation was a close second, as enterprises continued to replace obsolete equipment. Custom application development and software support and installation were a distant third and fourth, respectively. Together these four areas accounted for 66.5% of IT services revenue. "Systems integration is hot as alliances, mergers and acquisitions, and new technologies all require the unification of systems," says Popescue. "This will be particularly true in telecommunications, banking, logistics and distribution, and government, which are rapidly upgrading IT across the board."
The utilities sector was the single largest vertical in the Romanian IT services market last year due to a number of major projects in the sector. The privatization of the country's biggest bank helped make banking the second largest sector, as did the implementation of ebanking services and additional steps towards satisfying BASEL II requirements. The central government was the third largest vertical. Together, these three verticals comprised 34.0% of IT services spending. "All three sectors along with telecommunications are driving investment in IT services," says Popescue. "Privatization and infrastructure overhauls require most organizations within these verticals to turn to outside experts to help with their IT upgrades. To take advantage of this, IT services providers should pick a vertical and master the corresponding business processes."
IDC's Romania IT Services 2005-2009 Forecast and 2004 Vendor Shares (IDC# ES06M) examines the Romanian IT services sector and forecasts expenditure on IT services through 2009. The study contains market size, vendor market shares, and forecasts for thirteen foundation market categories. It ranks the top IT services providers and outlines their presence in individual verticals. The study also includes: predictions for spending on IT services; the trends in IT services delivery; and the strengths, weaknesses, portfolios, and strategies of market leaders.
For more information, please contact Tatiana Hinova at thinova@id.com or at +420 221 423 140.
IDC is the premier global market intelligence and advisory firm in the information technology and telecommunications industries. We analyze and predict technology trends so that our clients can make strategic, fact-based decisions on IT purchases and business strategy. More than 775 IDC analysts in 50 countries provide local expertise and insights on technology markets. Business executives and IT managers have relied for more than 40 years on our advice to make decisions that contribute to the success of their organizations.
For Central and Eastern Europe and the Middle East and Africa, IDC maintains a coordinated network of offices in 15 countries with regional research centers in Prague, Istanbul, and Dubai. Customers include a wide range of ICT hardware, software, and services suppliers, governments, and members of the financial community.
IDC '“ 15 Years in Central and Eastern Europe. Since 1990 IDC has been delivering essential intelligence about the ICT markets of Central and Eastern Europe. From a single person in a small office, we've grown into the region's leading IT market research, events, and consulting firm, with 70 analysts working in ten CEE countries.
IDC is a subsidiary of IDG, the world's leading technology media, research, and events company. Additional information can be found at www.idc.com.
