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industry profile presentation industry profile presentation Presentation Transcript

  • PRESENTED BY PAKISTAN SOFTWARE EXPORT BOARD (PSEB) PAKISTAN’S IT INDUSTRY PROFILE & STRATEGY
  • PRESENTATION ROADMAP
    • Global IT Industry Overview
    • Pakistan IT Industry Profile
    • Strategic Framework
  • GLOBAL IT INDUSTRY OVERVIEW IT INDUSTRY GROWTH IT INDUSTRY GROWTH 0 0.2 0.4 0.6 0.8 1 1.2 1.4 1.6 2004 2005 2006 2007 2008 2009 2010 Trillions Source: “IDC Press Release” 10 th Jan. 2007 6.3 1.481 2010 6.3 1.394 2009 6.3 1.312 2008 6.3 1.238 2007 5.6 1.165 2006 5.6 1.103 2005 5.6 1.045 2004 Rate Growth (US $ Tril.) Year IT INDUSTRY GROWTH
  • GLOBAL IT INDUSTRY OVERVIEW GLOBAL IT OUTSOURCING 0 20 40 60 80 100 120 140 2004 2005 2006 2007 2008 2009 2010 Billions Source: “IDC-Global IT Economic Outlook” 2004
  • ITPS GLOBAL MARKET SIZE Total Global Spending Total Outsource able Actually being 0ffshored US $ 1.045 Trillion US$ 280 Billion US$ 40 Billion Source: “Strategy for Increasing Exports of BPO” Bearing Point Report 2005
  • GLOBAL IT INDUSTRY OVERVIEW US IT OUTSOURCING SPENDING Source: “Worldwide and US IT Outsourcing Services” IDC Report 2004 U.S. IS Outsourcing Spending Share by Vertical Industry 0 2 4 6 8 10 12 14 16 18 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 % age Construction 16 Industries 15 Education 14 Wholesale 13 Insurance 12 Transport 11 Healthcare 10 Utilities 9 Services 8 Retail 7 Media 6 Processes 5 Finance 4 Government 3 Banking 2 Manufacturing 1
  • BPO SERVICES SHARE GLOBAL IT INDUSTRY OVERVIEW Source: “IDC-Market Opportunities by Horizontal Business Functions” 2004 11 682 614 554 497 447 405 375 Total 39 10 8 7 5 3 22 837 Training 7 38 35 33 31 29 27 26 Facility Operations and Management 6 183 176 168 158 147 136 126 Sales & Marketing 37 37 30 24 19 12 7 6 Engineering 12 288 255 226 200 182 166 155 Logistics 12 72 64 57 50 45 40 37 Customer Care 10 22 20 18 16 15 14 13 Finance & Accounting 34 6 4 3 2 2 1 1 Procurement 20 22 19 16 13 11 9 8 Human Resources 2003-2008 CAGR (%) 2008 $(M) 2007 $(M) 2006 $(M) 2005 $(M) 2004 $(M) 2003 $(M) 2002 $(M) KEY HORIZONTAL BUSINESS FUNCTIONS
  • GLOBAL IT INDUSTRY OVERVIEW BPO MARKET SHARE Source: “Gartner- Press Release” 2006
  • GLOBAL IT INDUSTRY OVERVIEW IT OUTSOURCING SUPPLIERS (USD BILLION) 0.9 0.5 1.8 1.9 4.7 12.6 17.2 India Canada China Eastern Europe Philippines Mexico Others Source: “Strategy for Increasing Exports of BPO” Bearing Point Report 2005
  • PAKISTAN IT INDUSTRY PROFILE “ Starting from a relatively low base in 2003, the Pakistan IT Industry has experienced rapid growth over the last three years … but sustaining this growth will require some targeted measures”
  • PAKISTAN IT INDUSTRY PROFILE OVERVIEW
        • Over 950 active IT companies
        • Over 125 ISO & CMM certified companies – a world leader
        • Seven MNC Development Centers and many more projects
        • Three Public Companies; Several World Class Product Companies
        • Two billion dollar industry, including one billion dollars of exports
        • IDC: “Surprising new home of offshore outsourcing in South Asia.”Lehman Brothers: “Best IT fundamentals of any offshore outsourcing country.”
        • PSEB re-engineered website ( www.pseb.org.pk ) receiving 1 million hits a month, 70% from overseas
  • IT COMPANIES BY LOCATION PAKISTAN IT INDUSTRY PROFILE Source: “PSEB National Census of IT Companies”, 2006 33% 954 TOTAL 1 13 Others 4 38 344 Karachi 3 28 290 Lahore 2 33 307 Islamabad/Rawalpindi 1 Percentage (%) Figure City S.No. Karachi 38% Other Cities 1% Lahore 28% Islamabad/Rawalpindi
  • CALL CENTERS STATISTICS PAKISTAN IT INDUSTRY PROFILE PSEB Registered Call Centers by city Call Centers Share in Total Revenue Source: “PSEB National Census 2006” “ Bearing Point Strategy for Increasing Exports of BPO” September 20, 2005 Call Center 26% IT and Software 60% Other ITeS 14% Islamabad/Rawalpindi “ 79” Karachi “ 131” Lahore “ 112” Other Cities “ 8”
  • PAKISTAN IT INDUSTRY PROFILE IT EXPORTS BY REGIONS Source: “SBP” Jul-Dec 2006 USA UK THAILAND UAE CANADA CHINA JAPAN HONGKONG GERMANY AUSTRALIA SINGAPORE OTHER USA 58% UK 9% Others 16% Thailand 4% UAE 3% Canada 2% China 2% Japan 2% Hong Kong 1% Germany 1% Australia 1% Singapore 1%
  • PAKISTAN IT INDUSTRY PROFILE GROWTH OF KEY COMPANIES Between 2003-06 these seven sample IT companies grew by over 400 % Source: “PSEB Survey” 2005
  • PAKISTAN IT INDUSTRY PROFILE TOP 10 EXPORTERS FY 05-06 0.75 Xavor Pakistan Pvt Ltd 10 0.85 Enterprise DB 9 0.99 Geopaq Tech. (Pvt.) 8 1.2 Trivor Software 7 1.4 Descon IT24 Pvt Ltd 6 1.51 Elixir Technologies 5 1.94 (*) System Pvt Ltd 4 2.23 TRG Pvt Ltd 3 2.93 Ovex Technologies 2 5.26 (*) Netsol Technologies 1 Rank Companies US$ Million Pakistan (State Bank Figures) Source: “SBP”, “PSEB”, “Bearing Point Study” September 20, 2005
  • PAKISTAN IT INDUSTRY PROFILE MULTINATIONAL DEVELOPMENT CENTERS & PROJECTS
  • PAKISTAN IT INDUSTRY PROFILE MULTINATIONAL DEVELOPMENT CENTERS & PROJECTS
  • PAKISTAN IT INDUSTRY PROFILE WORLD CLASS COMPANIES
        • TELECOM
        • Wavetech : Large display systems in public places
        • Inov8 : Leading mobile transaction management platform
        • Mobile complete: mobile testing suite
        • Pixsense: Mobile Photos
        • JOB PORTALS
        • Rozee.com.pk : Online recruitment solution
        • Personforce.com : US Online recruitment solution
        • DOCUMENT MANAGEMENT
        • eDox : Superior document management and office automation solution with over 150 international customers
  • PAKISTAN IT INDUSTRY PROFILE WORLD CLASS COMPANIES
    • PERSONAL PRODUCTIVITY
    • Scrybe : Leading Web based email and calendaring
    • solution
        • RETAIL
        • ITIM : Fast growing retail solution with over
        • 50 UK customers
          • SOCIAL NETWORKING
          • Naseeb.com : Muslim social networking portal
  • PAKISTAN IT INDUSTRY PROFILE WORLD CLASS COMPANIES
        • FINANCE
        • Mixit : Stock Market Order Management, NYSE, USD 0.5 Bil per year
        • NetSol : Car Leasing and Services. Daimler Chrysler,
        • Toyota, BMW
        • Autosoft: Retail banking Solution running in three countries
        • Metalbid.com : world leading metal exchange
        • TPS : e-payment and e-banking (Customers: Al Bilad KSA, CBK, BoK, ESB, UBL Kuwait, 1Link, Allied Bank)
  • PAKISTAN IT INDUSTRY PROFILE WORLD CLASS COMPANIES
        • ENTERPRISE COMPUTING
        • Ultimus : Business Process Management. 160 international customers including Microsoft & White House
        • Five Rivers Technologies : Clear Cube Partner and world leader in fast growing field of centralized computing.
  • PAKISTAN IT INDUSTRY PROFILE WORLD CLASS COMPANIES
        • SOFTWARE SERVICES
        • Visualsoft : Hardware and software system integration
        • Kalsoft : Advanced infrastructure design and implementation (*)
        • Averox : Enterprise client/server based solution
        • Si3 : System Integration solution providers
        • Techlogix : Business process improvement solutions
        • Techaccess : Enterprise management solutions (*)
        • Systems Ltd : IT and BPO services
        • Pi Sigma Group : Consulting and software development
        • Comcept: Innovative telecom solution provider
  • PAKISTAN IT INDUSTRY PROFILE WORLD CLASS COMPANIES
        • IT ENABLED SERVICES
        • Post Amazers : Animation. “Son of Mask” and “Exorcist : The Sequel”
        • LMKR : Seismological and Geological Data Management. BP, CALTEX, TEXACO.
        • iEngineering : Platform Management. Most comprehensive database in the world
        • Touchstone BPO, Ovex, Infospan, TRG, IT24 : IT enabled services/Call Centers
  • PAKISTAN IT INDUSTRY PROFILE EXPORT OF IT SERVICES Source: “Pakistan’s IT Revenue grossly understated” V1.4, PSEB, 31/08/2006 USD 1,050 million Grand Total USD 250 million (At least 5000 workers earning at least USD 50,000 per year on average) 4. Temporary Movement USD 450 million 3. Commercial Presence Abroad USD 200 million (Average USD 250,000 expenditure by over 800 entities) 2. Consumption Abroad USD 150 million 1. Cross Border IT Exports Mode
  • PAKISTAN IT INDUSTRY PROFILE LOCAL INDUSTRY REVENUE Source: “PSEB” and “Bearing Point” 2005-2006 USD 200 million IT Services Software and services, IT enabled services, (Other than sales to Multinationals, Multilaterals, and Foreign Missions) USD 150 million International Software Vendors USD 1,150 million Total Domestic IT Revenue USD 200 million Peripherals – 1/3 of Computer Sales USD 600 million PC/Laptops/Servers 1,000,000 new and used CPU@ USD 600 per CPU Revenue FY 05-06 Area
  • TOTAL INDUSTRY SIZE PAKISTAN IT INDUSTRY PROFILE Source: “Pakistan’s IT Revenue grossly understated” V1.4, PSEB, 31/08/2006 USD 2.2 Billion USD 1,150 Million USD 1,050 Million Total Industry Size Local IT Industry Revenue Export of IT Services
  • PAKISTAN IT INDUSTRY PROFILE COMPARISON WITH INDIA, 30 th June 2005 Source: 1. PSEB Study “Assessment of IT Professionals in Pakistan” – 2005 2. “PSEB Domestic Business Department” 3. “NASSCOM” 2006 4. “NASSCOM 2006” 5. “NASSCOM Strategic Review”, 2004, p 207 1:10.35 1:12.87 1:18 Ratio 6.21 GBS 5 965,250 4 USD 36 billion 3 India 600 MBS 2 75,000 1 USD 2 billion Pakistan Internet Bandwidth Usage IT Personnel Estimated Global IT Revenue Country
  • STRATEGIC FRAMEWORK “ While the Pakistan IT Industry has made impressive strides over the last three years, sustaining the growth will require a strong measures that are part of an integrated strategic framework and vision …”
  • STRATEGIC FRAMEWORK INTERNATIONAL BEST PRACTICES & LESSONS LEARNT 1950 MANPOWER MARKETING 1990 DEVELOPMENT AND COMMUNICATION COSTS FALL BY SEVERAL ORDERS OF MAGNITUDE MAKING LARGE SCALE OFFSHORE IT ECONOMICALLY FEASABLE AND CAUSING DEMAND TO SURGE 1980 FUNDING MANAGEMENT 2000 MANPOWER 2003 MANAGEMENT 2000 SIZE, DOMAIN, TECHNOLOGY, COUNTRY IMAGE
  • IT and Intellectual Property Protection, Convergence, and Taxes & Tariff equal challenge Deregulation policy major challenge and success Public Policy Only VC Multiple sources Finance Quality major problem. Cost also problem n.a. Telecom Bandwidth High rents not affordable High rents affordable Office Space Small, Manpower intensive companies that cannot afford high priced manpower High Margin, Capital intensive business that can afford expensive manpower Human Capital International, Highly Competitive Controlled, Domestic, Oligopolistic Market IT industry Telecom Industry Area
  • STRATEGIC FRAMEWORK Direct Drivers: Office Space HR Marketing Telecommunications Bandwidth Indirect Drivers: Provide Reliable bandwidth of sufficient capacity in quick time Provide Quality IT-Oriented Office Space at affordable rates in sufficient quantities and in quick time Provide adequate quality manpower in sufficient quantities with acceptable attrition, in quick time Sustained dominance of niches; Bring development house or call centre of large technology or other MNC to Pakistan Research on the IT Industry Strategy & Research Strategy, Systems, Culture Internal Grease the wheels of private enterprise Facilitation Legislation that promotes and protects the IT industry Policy Employ certifications as a “rite of passage” Company Capability Development Promote innovation, rapid growth and support the Strategy Finance
  • STRATEGIC FRAMEWORK STRATEGY & RESEARCH
    • Current Profile
    • PSEB In-house Pakistan IT Industry Size Study
    • PSEB National Census of IT Companies
    • PSEB Strategic Framework for IT Industry Development
    • Committee formed (SBP, MoIT, Statistics, EAD, PSEB) to gather statistics
    • Other Studies: BPO, Best Practices
  • STRATEGIC FRAMEWORK
    • Current Profile
    • PSEB has developed methodology for launch of VC Fund based on
    • interaction with several international VC, domestic financiers, and
    • Grant Thornton study
    • VC Benefits : VC funded companies have x2 sales, x3 tax payments, faster growth and innovation. In USA 11% of GNP and jobs by VC backed companies. In India USD 1.3 billion disbursed in 2003 alone. Similar successes in Israel, China and now Malaysia.
    • Private VC Ventures unsuccessful in Pakistan: KASB Ventures, Pak Libya Holding Company VC, Pakistan Ventures Limited, ABAMCO, EMP Fund, TRG & AMZ operating as acquisition vehicles, TMT as incubator
    VENTURE CAPITAL FUND & ENTREPRENEURSHIP DEVELOPMENT
  • STRATEGIC FRAMEWORK
    • Current Profile
    • Sales Pipeline for GLOBAL 2000/MNC Development Centers : Abu Dhabi Group/Raseen, MGI Wenham/SKP Consulting, Mondo/Aqcel, Softflux/Micromiles and Ingen. Contracts being negotiated with Microsoft and IBM. Pipeline: SUMMIT/Orascom Technology Solutions, Bearingpoint GDC, Barclay’s Bank.)
    • Reengineered Website now receiving one million hits monthly with
    • seventy percent from overseas. Over 150 leads directly passed to
    • member companies.
    • Monthly bulletins with industry news updates, PSEB activities, and
    • international report references now circulated to 3000 international
    • and domestic corporate and Government leaders – increasing
    • at over 500 a month.
    MARKETING & PR PR, Matchmaking, Sales Pipeline
  • STRATEGIC FRAMEWORK
    • Over one hundred and fifty PR Events including domestic and international TV interviews, radio interviews (including NPR), Magazine articles/interviews, promotion campaigns, advertisements and press releases.
    • Tradeshows : Last year PSEB sponsored fifty one companies in nine
    • international tradeshows and delegations and four domestic events.
    • Joint Action Plans (JAC)/MOU : Signed with Malaysia, China, and Turkey. Singapore and Mauritius in pipeline . Projects/leads as outcomes.
    MARKETING & PR Target – 2010 Pakistan to be positioned in key international markets as Tier One IT destination; Create awareness of IT industry growth and potential in the country, and awareness of PSEB programs in the IT industry.
  • STRATEGIC FRAMEWORK PUBLIC POLICY Target – 2010 IPR, Electronic Transactions, Electronic Crimes, Data Protection, and Convergence Regulation to keep abreast of technological and market advancement Convergence, Intellectual Property, Taxes & Tariffs
    • Current Profile
    • Removal of GST on computers
    • Facilitation of Cogilent CEO release
    • Working Papers on reducing Telecom BW cost and improving quality.
    • Data Protection Act
  • STRATEGIC FRAMEWORK HUMAN RESOURCE DEVELOPMENT
    • Current Profile
    • Currently 90,000 IT graduates in the economy. 35,000 in IT
    • industry including 10,000 in export companies. Studies on employment
    • and compensation.
    • PSEB strategy is to increase the enrollment and output of Tier One
    • Academic Institutions (Outreach Program), while improving the quality
    • of select Tier Two institutions (Professional Development Centers,
    • Soft Skill Development Program).
    • To further improve quality and international competitiveness , PSEB
    • undertakes Internship Programs (3000 interns placed), Apprenticeship
    • and Company Training Support Programs (Over 700 trained).
  • STRATEGIC FRAMEWORK
    • Current Profile
    • In the current year Visa processing facilitated for over 100 individuals ,
    • Foreign Exchange Remittance NOC for SW costing over USD 100,000
    • to fifty four companies , and corporate advisory to numerous companies.
    • New memberships 283 /renewals 223, Call centers newly registered
    • 195 and renewal of 16 call centers occurred in calendar year 2006.
    • OSRC : 11 migrations saving PKR 35 million;700 LAMP trainees from
    • 38 workshops; OSRC Web Portal (700 per day); I000 instruction kits;
    • international open source organization interaction
    • ERP : APTPMA (Textile Processing), PRGMEA (Ready Made Garments)
    • /PHMA (Hosiery), PAAPAM (Auto Parts), SIMAP (Surgical Instruments)
    • Interaction with industry associations (PASHA, OPEN, APSENA, TIE,
    • ACCO, CSP, PCA, and ISPAK)
    FACILITATION
  • STRATEGIC FRAMEWORK INTERNAL Target – 2010 Best management practices, automated, ISO 9001 and ISO 27001 certified. Market competitive salaries and 45 Additional positions
    • Next Steps
    • ISO Certification, ERP, ECM
    • Have requested 280% Funding Increase amounting to USD 1.63 million
  • PAKISTAN IT INDUSTRY PROFILE GROWTH PERCENTAGE 2003-2010
    • IT REVENUE GROWTH
    Source: “Strategy for Increasing Exports of BPO” Bearing Point Report 2005 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 USD in Millions 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 Fiscal Year Domestic Revenue Global Export Sales Export Revenue (Estimated) Export Revenue (State Bank)
    • IT INDUSTRY PROJECTIONS
    9,924 4,937 2,456 1,222 608 Bandwidth in Mbps 78,225 58,816 44,223 33,250 25,000 IT Graduates working in Domestic IT Firms 76,709 46,025 27,615 16,569 10,000 IT Graduates working in the Export IT Firms 250,000 177,262 127,756 74,729 52,500 Total HR working in IT industry 235,459 178,046 138,388 110,319 90,000 IT Graduates working in the Economy 8,781 5,934 4,060 3,112 2,000 Total IT Revenue in USD Millions 4,381 3,294 2,476 1,862 1,000 Domestic Revenue in USD Millions 4,400 2,640 1,584 1,250 1,000 Export Revenue Global in USD Millions 1,100 660 396 239 150 Export Revenue in USD Millions 550 330 198 120 75 Export Revenue (SBP) in USD Millions 09-10 08-09 07-08 06-07 05-06 Categories
  • STRATEGIC FRAMEWORK VISION 2010
    • Over ten billion dollars in annual turnover from several hundred million dollar services companies, leading product companies, and ten additional FORTUNE 500 and GLOBAL 2000 development centers.
    • Internationally recognized as a leading IT destination
    • 800 IT companies in the country
    • 10 IT/Technology Parks nationwide providing 20 million square feet
    • 230,000 IT graduates in the country
    • 250,000 IT and non-IT graduates employed by the IT Industry
    • USD 200 mil annual disbursement by VC Funds to the IT Industry
    • 10 GBS International Internet Traffic with 99.99% uptime
    • Over 300 ISO, CMM, ISO 27001, Six Sigma, OPM3, ITIL and certified companies
    • Effective regulation for Convergence Facilitation, IPR protection, data protection,
    • and prevention of electronic crimes and smooth regulatory approvals.
    • Accurate, yearly updated industry data.