Telecommunications

Slovenian ICT Market, 2006

Source: IDC, 2006

During the period under review, the Slovenian ICT market was characterized by high growth rates in almost every segment, reaching the estimate value of €1,556.23 million in 2006. The IT segment of the market totaled estimate €573.68 million, accounting for the 36.9% share of the overall market, while in 2002 this share stood at 28.5%. Slovenian

ICT market can thus be classified among more developed and mature markets of CEE region. The more evident justifications of such a statement are the relatively high share of IT services in the overall IT market, and the rising share of IT in the total ICT market. The latter is a very good indicator as to the level of market development, especially as the share of IT on virtually every developed market tends to attain or even surpass that of the telecommunications.

The difference between IT and telecommunications segment growth is the highest in Ireland (Δ = 5.0%), followed by Austria (Δ = 3.8%), EU (Δ = 2.9%), Slovenia (Δ = 2.7%), and Croatia (Δ = 1.8%).

Quality Workforce

SLOVENIA’S ICT INDUSTRY IS GENERALLY REGARDED AS ONE OF THE MOST VIGOROUS AREAS. ITS ADVANCE IS A CREDIT TO HUMAN CAPITAL AND WELL-DEVELOPED ICT INFRASTRUCTURE IS A RESULT OF AN EARLY COMMITMENT TO MAKING IT ONE OF NATIONAL DEVELOPMENT PRIORITIES.

Innovative spirit and clever technical solutions are the qualities often found in Slovenian workforce. In the sector, there are over 13,500 employees in over 1,600 companies. The pace of recruitment is a clear indicator that ICT is a booming business. From 2000 to 2006, headcount in ICT companies grew at 5.1% a year compared with the overall rate of employment in Slovenia of 0.4% a year. Expansion enjoyed by the companies into information technologies feeding on growing demand for ITC services has pushed the industry figures up.

Slovenia was quick in recognising the need for a pool of young talent educated for the “New Economy”. Computer science was included in the university curriculum some thirty years ago and since then courses in IT and informatics have become highly popular with students enrolling either in the University of Ljubljana or Maribor. Over the past few years, their number has surged and already reached 7,000 students. Secondary education programmes for computer science, electrical engineering and telecommunications have attracted over 9,200 attendees.

Individuals' level of high level computer skills, 2005 (as a percentage of the total number of students)

Source: Eurostat, 2007

Individuals' level of high level computer skills, 2006 (as a percentage of the total number of individuals aged 16 to 74)

Source: Eurostat, 2007

Quality Link to Regional Markets

A CENTRAL GEOPOLITICAL POSITION AT THE CROSS-ROADS OF TRADE AND TRANSPORT ROUTES GIVES SLOVENIA A CUTTING EDGE AND EXPLAINS ITS HISTORICAL, CULTURAL AND ECONOMIC PROFILE – THE KEY ELEMENTS OF THE COUNTRY’S ECONOMIC PERFORMANCE.

The role played by the ICT to Slovenia’s export mix is extremely important. ICT-related export figures have risen sharply. Between 2000 and 2006, the average annual export growth rate was 11.1%. Exporters of telecommunications equipment account for nearly 34% of overall industry exports followed by providers of IT services. Hermes Softlab is an undisputed champion in the field of IT services and a leading company in the region meanwhile Telekom Slovenije remains Slovenia’s leading exporter of telecommunication services.

Slovenian companies are fostering their presence in foreign markets through outward direct investment. This trend is widely followed by ICT companies, particularly when investing in the emerging markets of ex-Yugoslav republics. Capital ties are also used to get a foothold in the markets of CIS countries.

Thanks to its position and decades of fostering economic links with its neighbours, Slovenia is in a pole position to serve the markets in the region. The number of international companies setting up their regional hubs in Slovenia is rising attracted by the expertise of local managers, sales force and field engineers and their in-depth knowledge of the regional markets. They speak the language, they are familiar with legislation, they know their way around, and what’s most important there are no cross-cultural barriers for them.

A cutting edge of Slovenian workforce is command of foreign languages. International studies rank Slovenians at the European top. 91% of population can communicate in at least one world language with the English and German being most widespread (71% of population is able to communicate in at least two world languages). Nevertheless, language schools are still busy year round and companies encourage staff to brush up on their language skills on a regular basis.

Quality Infrastructure

SLOVENIA LIES AT THE INTERSECTION OF TWO PAN-EUROPEAN TRANSPORT CORRIDORS FOR ROAD AND RAIL TRANSPORT. ITS TRANSPORT AND IT INFRASTRUCTURE IS WELL-BRANCHED. THE ADRIATIC PORT OF KOPER IS THE SHORTEST MARITIME CONNECTION FOR CARGO ARRIVING FROM ASIA TO LANDLOCKED COUNTRIES OF CENTRAL EUROPE THROUGH THE SUEZ CANAL.

In terms of ICT infrastructure development, Slovenia is clearly ahead of other new EU Member States. On the scale used for the Digital Access Index (DAI) serving as a “yardstick” for comprehensive development of information society of a country, Slovenia’s 24th place means that it is the company of the countries enjoying a high access index and leaving behind some EU-15 countries such as Ireland, Spain, Greece and Portugal.

Comparison of key information society indicators, 2006

Source: IMD - World Competitiveness Yearbook 2007

The users of the mobile telephone network realized 723 million minutes of outgoing traffic in the 2nd quarter of 2007. This in fact means a 9% increase in comparison with the same quarter of 2006. Duration of calls was in the first six months of 2007 by almost 10% over the level of January–June 2006.

The traffic mentioned above was realized by 1,875 thousand users of the mobile network; 60% of them were subscribers and 40% were users of prepaid SIM cards. Among all users of the mobile network, 42% were using GPRS technology enabling the transmission of data over a mobile telephone.

In the group of ten new EU Member States, Slovenia along with Malta and Cyprus is the only new entrant boasting widespread XDSL services. Slovenia’s ADSL coverage was at the end of 2006 over 95%.

To make headway in ICT, Slovenia has to keep the pace of modernisation and continue to upgrade information infrastructure, encourage acquisition of new knowledge and pro-active collaboration between companies and think-tanks as carriers of R & D. The establishment of the Ministry of Information Society responsible for creating a suitable environment for the advancement of information sector at all levels sends a clear message that Slovenia is part of the cyber world.

Price of fixed telecommunications (EUR per 10-minute call)

Source: Eurostat; Europe in figures, Eurostat yearbook 2006-2007