Software
Development
Market Overview
There are approximately 6,000 computer companies registered in Poland. Of the 200 largest, 104 develop software.
The Polish software market grew by 40-50% in 1997, reaching approximately USD 330 million, thus becoming a remarkable segment of the whole sector. The software market is the fastest growing segment of the information technology sector. In 1997, almost 64% of sales were of Polish software, with over 25% of the market share held by U.S. manufactured software.
Horizontal breakdown of the software market shows tools software representing 38% of the market, office software 26%, system software 20%, and communications software 16%. The vertical breakdown shows that the enterprise management software represents 41% of overall software, CAD/CAM 35%, banking and financial software 11%, administration 10%, and education three percent. Dominant operation systems are DOS, NetWare, Unix and Microsoft Windows. C/C++, Progress, and Clipper are the dominant language tools.
Approximately 35-50% growth is expected to continue for the next two years. Despite continued improvement, software piracy is still a problem, affecting mainly off-the-shelf software. Software infringement is usually done by individual users and is the focus of attention by both government officials and the private sector.
The increase in computer software sales is also due to the growth of computer networking in many companies and organizations and the upsizing of data base management systems. Special software opportunities exist in networking software and tools. The software distribution companies continue to experience a trend toward consolidation.
The statistics for the export and import of computer software are not available, as only the medium, not its content, is recorded.
| USD Millions | 1997 | 1998* | 1999* |
| Total Market Size | 330 | 462 | 693 |
| Total Local Production | 211 | 295 | 450 |
| Total exports | 70 | 98 | 137 |
| Total Imports | 189 | 265 | 380 |
| Imports from the US | 83 | 130 | 190 |
| * The above statistics are unofficial estimates. |
Software Manufacturing
Polish companies manufacture approximately 60% of software sold on the market. Polish programs account for 80% in the banking and financial sector, 90% in administration, 84% in manufacturing enterprises and 45% of CAD/CAM software. Most Polish companies sell foreign software to supplement their own offerings, often adding value through localizing and adapting to Polish regulations. The market share of American companies is estimated at a minimum of 25%. Polish companies take advantage of the increasing interest in multimedia and have secured strong positions in education software .
In 1996, Optimus, the largest computer company, created two companies specializing in multimedia: Optimus Pascal Multimedia and Optimus Nexus CS. Some traditional publishing houses such as Wydawnictwa Szkolne i Pedagogiczne (School and Pedagogic Publishing House), Wydawnictwa Naukowo-Techniczne (Science and Technical Publishing House) or PWN Science Publishing House offer publications in multimedia in cooperation with software companies.
International Data Group (IDG) reports that 102 Polish software companies sold $64.5 million worth of their in-house developed software. Another analysis of 72 companies (ComputerWorld, Sept. 9, 1996) shows that 45.6% of sales are for enterprise management software, 28.5% for banking software, 6.1% for CAD/CAM/GIS software and 19.8% for other.
Business Software
The business software segment for large companies is dominated by foreign suppliers. There are approximately 1100 MRP/ERP projects implemented in Poland. Leading suppliers are SAP, Prokom, IFS, Qad, Baan, COIG, CIE, JBA and Kompakt.
For many years the business software segment for small and medium size enterprises has been dominated by Polish solutions. Major Polish software suppliers are: Altkom Matrix, CDN, Digitland, InsERT, MacroSoft and Simple. With the growing importance of this segment, foreign suppliers are becoming more interested. Foreign companies now in this segment include: Great Plains, Ecliptor (Platinium), Exact, Scala and many others. Some software companies, which have been concentrating on larger clients, are getting ready to offer lower cost solutions for smaller companies. This move creates a very competitive situation for all players.
The largest Polish software developers are: Prokom, Softbank, CSBI, COIG, River, Compact Disk Novelty, Logotec Engineering, Software, Softlab Trade, Spin Katowice, Comp Rzeszow, Fast Systemy Komputerowe, Emak, Altkom Matrix, Hector, ZETO Katowice, Impaq Polska and Macrosoft. Polish companies were able to capture over 50% of the software sales for new computer systems. Polish companies specialize mainly in software applications for industry, administration and banking. Polish companies lead in education software for schools and individuals, major companies also exporting their products include Young Digital Poland of Gdansk, VULCAN company of Wroclaw and SuperMemo World of Poznan. Other companies exporting software include Inter-Design Tessel Systems, Polish-Swedish company, specializing in document imaging and GIs software, SolidConsult exporting its CAD software, Logotec Engineering - design PGM software, and Aplicom 2001 software for project management.
In the CAD/CAM/CAE software arena (which is still very small), Polish users prefer engineering software running on the PC platform. Autodesk, Bentley and Unigraphics are the major suppliers to this market. AudoCAD is the dominant software.
Database Management Software
Data base management systems are dominated by American suppliers. Oracle dominates, but other suppliers include Microsoft and Informix.
American companies generally dominate in all sectors of the software market. Many US companies maintain their own offices in Poland. Motorola recently made a decision to invest in a Software Development Center in Krakow's Special Economic Zone. This investment is estimated at USD 18 million. Informix is in the process of establishing a training center in Warsaw for its Eastern European partners.
Coping With Competition
Increasing competition in the computer market has been forcing Polish computer companies to consolidate their efforts by entering into cooperation agreements, forming consortia/holdings and merging. Only large computer companies are able to meet customer requirements for a full range of services, from designing a system to operating large-scale computer networks. Large customers with offices in many cities often need computer systems to function on a national scale. Customers tend to choose computer companies which are able to perform such complex tasks. Medium to very large computer companies get approximately 75% of computer systems and services projects. There are some recent samples of this consolidation trend.
Optimus S.A., the largest computer company in Poland, made a decision to invest in the development of multimedia publications and the development of Internet servers offering on-line service with own information bases. Optimus captured over 35% of the Polish computer market and it has been listed on the stock exchange since mid 1994. OPTIMUS S.A. is a holding with a developed trade-service networks (23 companies, 1000 dealers and 160 authorized service outlets) in Poland and abroad. The main activities of Optimus are production and sales of computer equipment and fiscal cash registers, multimedia programs, system integration, Internet and telecommunication services.
In February 1996 Prokom, Koma and Technimex formed a holding company, becoming Poland's largest software designer, producer and integrator of complex computer systems. Prokom has become the group's coordinator. CSBI SA, another large software company specializing in banking software has recently been acquired by ComputerLand capital group, the largest computer integrator in Poland. ComputerLand holding currently has two software companies specializing in banking, CSBI and PTB Elba. Softbank, a major software company focusing on banking created a joint venture with ICL/Fujitsu, thus obtaining adequate capital, and access to the technology and distribution systems. This merging trend is expected to continue in the near future.
International Software
Some Polish software companies are successful to secure outsourcing contracts as subcontractors for international software projects. The examples are Logotec and IGE specializing in CAD software, InterDesign (CAD/GIs) or Koncept (banking). CrossComm Poland develops routers software for its American office.
Sources
Industry Sector Analysis of the Personal Computer Market: Poland -- (CEEBIC)
2001 Country Commercial Guide: Poland -- US Department of State
Industry Sector Analysis of Networking Hardware and Software: Poland -- (CEEBIC)
Computer Software Industry in Poland -- (CEEBIC)
POLAND: APPLICATION SOFTWARE -- (CEEBIC)
Information Technology Landscape in Nations Around the World