Techreport,
The Software Sector: A Statistical Profile for Selected OECD Countries
Directorate for Science, Technology and Industry, Committee for Information, Computer and Communication Policy, OECD, (1998)
Abstract
Main points
1. This paper constructs a statistical profile of one of the most rapidly growing information and communication technology (ICT) industries, the software industry, and examines several issues of importance to the information economy. This ICT sector is, arguably, the most important segment of ICT economically, and is to the knowledge-based economy what the steel and automobile sectors were to the industrial economy. From a statistical perspective, it also raises issues which are at the heart of the changes that are taking place as the information economy spreads. Because of its intangible nature, software is difficult to measure and more easily subject to duplication and piracy.
2. This paper seeks to alleviate the shortcomings of both private and public data by blending the two sources and to examines ways to build integrated statistics that allow for international comparison of a small number of software and computer services indicators. It is not exhaustive, either in terms of statistical sources or of geographical coverage, and covers only certain OECD Member countries (United States, Japan, Canada, Australia, New Zealand, Finland, France and the Netherlands) . It aims to create a framework that can be altered and extended to include new variables and countries.
3. Three types of sources were used: internationally comparable official statistics, national statistics (both government and other national sources), and market and firm-level data. The respective classifications and definitions are provided.
4. Data for the software and computer services sector are presented for value added, employment, number of establishments, R&D, and investment. On the basis of the available national data, sub-sector breakdowns are provided for revenue, employment and number of enterprises.
5. The dynamism of software and computer services is evident in several of these variables. The sector's revenue has grown at an annual average rate of more than 13 per cent over five years in the United States and Japan. In all the countries examined, this sector accounts for more than a quarter of the business R&D expenditures by the services sector. It is also growing in terms of employment; in the United States, the annual average growth rate has been over 9 per cent since 1990.
6. Trade data make even more acute the measurement problems associated with this sector and provide an indication of the role of international trade in this industry. Nearly half of all sales by US producers are international.
7. Market data show the growing share of software and services in the world-wide IT market -- from 46 per cent in 1987 to 52 per cent in 1995 -- and the dynamism of the Asia-Pacific region in terms of relative growth, with an average 22 per cent between 1995 and 1996.
8. Several studies estimate prices indexes for PC software and show a price decline of between 2.7 and 9.7 per cent from 1986 to 1994, depending on the software and the country.
9. Finally, firm-level data and data from private providers give information on industry ranking or concentration in terms of revenue.
