Croatian IT Services Market Grows 15.2% to $365 Mln in 2007 - IDC Adriatics

"IDC attributes the slower growth to parliamentary elections held in November 2007 and to a number of postponed IT services deals,” the company said in a statement.

IDC Adriatics added that it expected that the Croatian IT services market would grow by 7.6% this year with total IT services spending reaching $393 million.

"The Croatian IT services market has been growing rapidly, in line with the country's preparations for EU membership. However, heightened competition, an economic slowdown, and rising
inflation predicted for the immediate future could slow this growth considerably," the IDC Adriatics managing director, Boris Zitnik, said in the statement.

IDC expects the IT services market in Croatia to slow its growth to an average annual rate of around 11% over the next five years, due to its progressing maturity.

According to IDC, the top three IT services provider in terms of revenue in Croatia last year were Siemens IT Solutions and Services, Combis, and Apis IT. Together they held almost a quarter of the market. Combis and Apis IT maintained their positions from 2006, while Siemens IT Solutions and Services replaced IBM at the top of the ranking.

At 25.3%, the combined customisation category had the largest share of the IT services market in Croatia in 2007, IDC Adriatics said. Systems integration services had a 24% market share, and the hardware and software support and installation made up 23.7%.

IT outsourcing, which skyrocketed 63% in 2006, grew a meager 2.6% in 2007, to account for 16.4% of the total IT services revenue, IDC Adriatics said.

Accordng to IDC Adriatics the combined finance sector was the largest vertical market in Croatia in 2007 with a 22.0% market share.

"The government sector, which placed first the prior year, placed second with 21.5% in 2007," IDC Adriatics added.

With a market share of 20.3% the telecommunications sector ranked as the third-largest vertical sector.

"The fastest-growing market segment was transportation, surging 53.3% year on year, although from a relatively small base," IDC Adriatics said.

IDC Adriatics ( www.idccroatia.hr ) is the Croatian unit of U.S.-based IDC.

($=0.724 euro)