There is huge potential for Irish software companies despite the current upheaval in technology markets, the Irish Software Association's National Conference was told today.
However, international investment expert Charles Elliott cautioned that investors were now looking to companies which had a clear route to profitability.
'Ireland's software sector continues to have a significant global potential because of its educational environment, helpful tax position and positive European situation,' he said.
Mr Elliott said that there were grounds for cautious optimism that the global technology market was recovering. 'The number and severity of profit warnings are decreasing and inventories are falling from peak levels', he said.
Speaking at the ISA's conference today, Tanaiste Mary Harney pointed out that over the last 10 years, the software industry had grown from a handful to over 800 companies, almost 700 of which were Irish owned.
The industry employs over 25,000 and total revenue for the sector is in excess of £6 billion. Irish owned companies account for over £1 billion of that total.
The Tanaiste said she believed that despite the general downturn in the IT sector, the future was not all gloom and doom for the industry.
'It is important to stress some positives which will serve to see the IT industry here survive this period of crisis,' she said. 'Most of the Irish owned software companies are product focussed. This investment in the development of their own Intellectual Property means they have an asset'.
She also said that the local Irish market, while slower than in previous years, continued to grow providing opportunity locally.
'The UK and EU markets have not been hit to the same extent as the US and should potentially be regarded as a new export market focus for the industry here. The new emerging markets in China, India, the Pacific Rim and Latin America also present opportunities.'
Addressing the conference, the Irish Software Association's Chairman, Billy Huggard, warned that Ireland could lose out as a major European software centre because of the cost of corporate bandwidth access to the Internet is uncompetitive.
'Software exports will increasingly be delivered via the Internet rather than in boxes,' he explained. 'The issue now is one of cost rather than availability and Ireland is uncompetitive against the UK and other potential European centres for software companies'.
He said the delay in making broadband available to consumers would also hit the indigenous software industry as it would have no home testing ground for future product development.
