Over 10 years, 18.8 → 69.4% of the performance 'increased'
The proportion of orders received from large corporations reached 30%
Impact of exception recognition project, bidding project, etc.
Small and medium-sized software (SW) companies performed more than 90% of public software projects worth less than KRW 2 billion. It is interpreted that after the 10th year of enforcing the SW Industry Promotion Act, which restricts the participation of large software (SW) companies in public SW projects that exceeds 90% in both the cost and number of projects, has settled in the market.
After analyzing Korea Software Industry Association’s report of 1549 cases of software development and construction projects (January 1st - December 31, 2021) disclosed on the Public Procurement Service Open Portal, the amount of projects performed by small and medium-sized software companies that worth less than KRW 2 billion was 97.8%.
97.2% of under KRW 100 million projects, 99.4% of KRW 100 - 500 million projects, 97.7% of KRW 500 million - 1 billion projects, and 96.5% of KRW 1 - 2 billion projects were carried out by small and medium-sized software companies when sectioning the projects by cost. When considering all projects including projects worth more than KRW 2 billion, the amount of projects done by small and medium-sized software businesses account for 49.4%. Medium-sized enterprises account for 21.8% of remaining projects, and large enterprises account for 28.8%.
This means that half of the last year’s public software projects ordered through the Public Procurement Service were carried out by small and medium-sized companies, and the rest were carried out by medium and large enterprises based on the cost of projects. In terms of the number of projects, small and medium-sized software companies performed 92.8% of the total projects. Medium and large enterprises account for 4.1% and 2.9%, respectively. Small and medium-sized software companies account for 97.9% projects when considering projects less than KRW 2 billion.
<Table> Share of software development and construction projects by size based on 2021 Public Procurement Service Open Portal (based on amount, %)
*Excluding other non-profit corporations
By Staff Reporter Hocheon An (email@example.com)