Ukrainian IT Services

According to feedback from market experts and players, the volume of Ukrainian IT-services exports in 2003 will range from $30M to $100M in revenue. We estimate this amount will be $70M. The members of the market are quite optimistic about its growth and are forecasting that Ukrainian IT-services export revenue will double over the next two years, or 40-50% annually. Increased growth rates (even exceeding the above stated) are feasible provided a) the industry's development will be supported by the Ukrainian government and b) the largest players of the market will consolidate their capacities and efforts for promotion in foreign markets.

According to the experts, export revenue comprises from 30% to 50% of the entire market for IT-services rendered (according to our calculations, 50%) and will increase to 60% by 2005. The market is order-oriented, and the product ("off-the-shelf) model constitutes no more than 10-15%. It is forecasted that its share will grow, and in 2005 will amount up to 35%. Some experts break the market into 2 equal parts 50/50. (It is forecasted that the products will increase in their competitiveness by 2005; not it is 20%).

There are around 20-25 public (or known) IT companies in Ukraine, which are mainly located in Kiev, Lvov, Kharkov, and Dnepropetrovsk. Practically speaking, there are no development centers for large corporations in Ukraine. There are around 200 small companies and independent software developers' groups, whose market share ranges from 10% to 65% (according to our estimates amounts to 35%). The number of total specialists working in the Ukrainian IT-services and products export market in 2003 is estimated to range between 8,000-10,000. Various public information sources provide the numbers ranging from 20,000 to 25,000

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