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Thursday, October 07, 2004
Local software developers face tremendous odds: industry player
TREMENDOUS challenges face the local software industry, among them financing, the scarcity of manpower, and unfair competition posed by the sale of pirated software.
This was revealed by Wilson Ng, president of e*Sprint Software during a seminar on the importance of copyright in technology innovation held at the Cebu City Marriott Hotel.
“We’re faced with tremendous odds. There are technology challenges.
Financing is also a problem. Local software companies are also competing against multinationals in hiring talent,” he told participants of the seminar conducted by the Intellectual Property Office (IPO), Business Software Alliance, Department of Trade and Industry and the Intellectual Property Alliance.
He said multinationals could better attract software developers because of their branding and financial muscle, enabling them to give higher salaries.
Ng explained that multinational companies had the edge because they sold their products abroad, where the market was willing to pay more for their products, justifying their costs in producing their products. But local software developers tend to sell to the local market, so they had to offer the products at lower prices.
Lend
On the problem of financing, Ng lamented: “Banks will not normally lend money, and not many investors will invest in software development because they say software can’t be collateral and because without IPR (intellectual property rights) protection, it is hard for software to bloom.”
However, the information technology practitioner emphasized that local software developers’ biggest threat was not foreign software, “but free foreign software.”
He said local software could still compete with foreign software, because local software was designed to suit local needs; but pirated foreign software could sell for just P80.
“We are supporting the IPO because we believe that respect for intellectual property is indispensable to the growth of the local software development industry,” Ng said.
Opportunities
Despite the challenges, he saw opportunities.
Ng said that in the last 10 years, there had been a specific correlation between the increased sale of foreign software and the willingness of the local market to pay also for local software.
“That gives us confidence, because we want to target both the local and export markets,” he said.
However, he explained that to target the export market, “we have to get a track record (in sales) from the local market.”
IPO Deputy Director General Pacifico Avenido Jr. said the law does not give IPO the direct enforcement jurisdiction and authority to run after software pirates, “except those vested in the IPO’s Bureau of Legal Affairs.”
But the office coordinates the efforts of agencies involved in enforcement, like the Philippine National Police, National Bureau of Investigation, Optical Media Board, and the Criminal Investigation and Detection Group. (CTL)
(October 7, 2004 issue)
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