The regional Adriatics IT services market – including Albania, Bosnia and Herzegovina, Croatia, Kosovo, Macedonia, Montenegro, Serbia, and Slovenia – grew 20.5% year on year in 2008 to total $1.06 billion. Croatia remained the largest market, accounting for 40.0% of total spending, followed by Slovenia, with 34.9%, and Serbia, with 14.0%. Bosnia and Herzegovina, Macedonia, Albania, Kosovo, and Montenegro accounted for the remaining 11.1% of IT services spending in the region in 2008.

The financial sector undertook the highest spending on IT services in the Adriatics in 2008, accounting for 20.6% of the market. The combined government sector was the second-largest vertical market, with 19.6% share, and telecommunications was the third-biggest spender, with 19.1% share.

“Most of the Adriatic countries started to feel the impact of the global economic crisis in the last quarter of 2008,” says Senior Research Analyst Dalibor Suboticanec, IDC Adriatics. “In 2009, the majority of countries in the region have experienced a GDP decline, falling industrial production, decreasing exports, reduced household consumption, and rising unemployment. The crisis will impact all areas of the market.”

Systems integration services were most in demand in the Adriatics in 2008, accounting for 16.3% of IT services spending. Hardware support and installation was the second-largest segment, accounting for 14.4% of spending.

“Competitive pressures, regulatory compliance, modernization, and adjustments of public ICT infrastructure to EU standards, improvements of public services through implementation of various IT solutions or web portals, IT systems adjustments related to acquisitions, and automatization of business processes are all driving spending on systems integration, customization, and consulting services, while diminishing the predominance of basic services like support and installation,” states Suboticanec.

From a vendor perspective, S&T was the market leader in the Adriatic region in 2008. Combis took second place, and SRC placed third. The market being highly fragmented, their combined market share reached 15.5%.

IDC expects the IT services market in the Adriatic region to expand at a compound annual growth rate of 6.3% over the five-year forecast period, to reach $1.44 billion in 2013.

IDC’s Adriatic Region IT Services Market 2009–2013 Forecast and 2008 Vendor Shares (IDC # ES38R9) presents the Adriatic Region IT services industry in 2008 and forecasts expenditures on IT services through 2013. The study provides total market size information, vendor market shares, and revenues by IT services categories and vertical markets, and includes profiles of the top five IT services providers, including their IT services portfolios, their presence in individual vertical markets, and their largest contracts in 2008.