Itanz at odds with Statistics' sums

By RICHARD WOOD

The Information Technology Association is at odds with global IT researcher IDC over how software sales are counted by Statistics New Zealand.

Itanz wants "bespoke" and customised software made for individuals to be counted as packaged software rather than as an IT service, as it is now treated in Statistics' annual IT survey.

Itanz executive director Jim O'Neill said he was concerned about how the software industry would be perceived if there was "under-claiming".

In the 2002 survey, software exports were valued at $121.2 million, up 21 per cent on the previous period. Computer services were up 36 per cent at $364.9 million.

IDC analyst Mark Cribbens said anything packaged was software, but as soon as it was customised, or software was built from scratch for a client, then it should be recorded as services.

"If someone engages you to build something, that is a service. IDC would argue that they will be under-calling the IT services market."

But O'Neill said software was often developed for one client but the intellectual property was then used to create a similar, but customised, solution for another. In that case it was a piece of software.

The sub-category of software exports in the statistics should be double that recorded, he said.

This is not the only case of unusual counting in Statistics' survey, released last week. Total IT sales - sales to resellers, end-users and exports - stood at $7.05 billion. But Statistics economist Stu Pettigrew acknowledged this included double or triple counting of a product's sales.

Local end-user sales and exports come to $5.24 billion, of which $967 million was in exports.

Total IT sales were 2 per cent down from the previous period. Exports climbed 17 per cent, while local end-user sales were down 6 per cent.

IDC does not record export figures, but Cribbens said total end-user figures from Statistics were reasonable. However, because of the way Statistics categorised time periods, he compared them to IDC's figures of a year ago.

Sales of IT education and training, which took an apparent 62 per cent dive in last year's figures, were another problem.

O'Neill also said export software sales by local branches of multinationals might be miscounted due to internal reporting procedures.