Several years ago, a company which specialized in developing software products for the healthcare sector was put on sale. At that time, the offer did not catch the attention of many investors. Meanwhile, an enterprise had sent words that it would buy the company if it has the opportunity.

One of the two enterprises has the staff, who were once physicians and doctors. Therefore, it has gained certain achievements with the marketed products, thanks to the deep knowledge about healthcare. Meanwhile, the other is a leading technology company which has big advantages in techniques, but does not have deep knowledge about healthcare. They have realized that they can only develop well if they can settle their problems.

Many software companies born, but few can survive

The above story is a typical example which shows the weak points of software companies. The majority of Vietnamese software companies have small scale and weak financial capability. They cannot draw up reasonable long term market development strategies, lack professional business skills and bear hard pressure from technology changes. Meanwhile, some big enterprises, which have big operation scale, financial and technical capability, are seriously lacking the staff who have the deep knowledge on specific fields.

A lot of software companies came out in the society prior to 2000, but only a few have existed. The survivors are mostly the ones which design accountancy software products and provide the products to state management agencies.

The big problem now is that businesses can be born, but cannot grow up, and many good products cannot be brought up, because companies cannot survive the severe living conditions.

The products, which were made in Vietnam, but they are simply the re-production of foreign solutions, have been eliminated. Many other products have been welcomed by the market, but the owners have to struggle hard to compete with foreign solutions which have been distributed in a diversified way and produced by the experts with deep knowledge in many fields.

The success of enterprises not only depends on whether they have good products, but also on many other factors, including the capability of market analyzing, production marketing, and on the budget on building apparatus and developing products. A lot of software companies had to leave the market, because the software trade could not bring them the sufficient income.

According to Pham Anh Chien, General Director of FPT Software, the bad copyright protection is now a big headache to enterprises these days. There is no effective tool to effectively protect software products in the current conditions of the legal framework. This explains why enterprises do not want to spend money on making investments.

Thorough care needed to develop the market

According to Chien, software companies can succeed only when they can satisfy the specific demand from enterprises, or localities and agencies, where foreign software products cannot reach out.

The fierce competition in the fields of finance and banking, steel, real estate has forced the investors to spend money on information technology solutions. Therefore, the demand for the software products has been increasing from the fields. However, the fields are the “land” of foreign solutions.

According to Tran Luong Son, General Director of VietSoftware, state budget-funded information technology (IT), projects worth tens of billions of dong are the big opportunities for domestic companies. However, he said that companies have to face big risks when implementing the projects, and that they cannot see the stability to ensure business prospects.

For a long time, IT projects have been managed like normal products and they have to go through complicated investment procedures, while these should be seen as creative and special products.