Ukrainian software producers are going to make their voice heard in the international arena. This will be done in the US which plans a traveling show of Ukrainian high-tech companies in November. The function will include the US-Ukrainian IT Forum in Washington and talks with potential business partners in San Jose, California (in the famous Silicon Valley). The show’s main attraction will be the presentation of the first professional study of the Ukrainian information technologies and services export industry done by leading international experts in IT and telecommunications.
The export of information technologies, also known as offshore programming (which, unlike offshore financing, bears no negative connotations), is estimated at $50 million in Ukraine. As a considerable segment of this is part of the shadow economy, high-profile deals with large world companies are not always a matter of public knowledge. The information economy is now experiencing brisk development of outsourcing, which means that some firms subcontract certain operations from large IT companies. The corporate giants find it profitable to place orders in cheap-labor countries. Experts forecast that in the near future every tenth job in US IT companies and each twentieth IT job in other industries will be created due to offshore outsourcing. Quite telling is the example of India: its export of information products and services is now worth $10 billion and is planned to reach $50 billion by 2005.
Establishing themselves on the US market, Ukrainian programmers are not going to compete with their Indian counterparts in the cheapness of labor. According to Serhiy Loboiko, business development manager at the A-Ventures Company and one of the road show organizers, Ukraine will find another niche — intellectually intensive production. Filling this niche, our IT companies will be able to sell their products at prices higher than those set for simple code writing. A-Ventures President Andriy Kolodiuk believes that the Ukrainian IT industry is fully capable of developing unique and competitive products, but the trouble is that our specialists are practically unknown in the outside world. He maintains that the forthcoming function will make it possible to bridge this gap and also help the main players on the Ukrainian market to combine efforts (the show will be attended by twenty Ukrainian companies).
Unfortunately, we are not pioneers in this field: now that Russia has already passed this stage, we have to catch up with our main rival. According to Sergei Makedonsky, general manager of the Russian Market-Visio Company, joint efforts of Russian IT industry leaders made it possible to boost the export of technologies to $250 million in 2000-2002 and, supposedly, to $330-350 million in 2003. Yet, we have very good growth prospects: Ukraine has been showing quite a high growth rate (over 20% a year) of the export-oriented software production of late.
