How Ireland Reigned Supreme in Software Exports

How Ireland Reigned Supreme in Software Exports

SEAMUS Gallen is a computer scientist employed by Enterprise Ireland, a government agency involved in industrial development.

Not all too long ago, Gallen asserts that tourists visiting from the Far East would have struggled to even find his country on a map, but now they’re arriving in vast numbers to discover why Ireland is the largest exporter of software in the world. Ireland, in fact, has even overtaken the U.S., China, and India when it comes to sales of computer programmes either purchased digitally or on CD.

The country is known for many things: Guinness, the gee-gees, and gambling being just three examples. Although, with regards to the latter, many an Irishman are playing at these casinos online rather than taking the trip down to their local casino. Of course, they have technology to thank for that. When it comes to software, however, it's all about what's going on right here in Ireland. What makes Ireland’s share of the market particularly surprising is the fact that the country is roughly half the size of Bavaria, Germany, and that the entire population is only slightly higher than Berlin. So, it isn’t as if there’s a domestic market that could help to explain the astronomical software sales. That leaves the question of why so many investors are arriving here remaining.

Around two decades ago, at the dawn of the IT revolution, the benefits that come with Ireland's location and business-friendly nature caught the attention of investors in the U.S. In fact, when it comes to culture and language, Ireland is a close relative of the U.S.

For Gallen, however, he’s less keen on history and more interested in letting those visiting from Latvia, Hungary, and China know about Ireland younger generation, who are enrolling in technology degrees in huge numbers. He also refers to the government’s economic policy and low taxation when offering explanations for the success of Ireland’s software economy.

Dublin alone features 1,200 people employed by Microsoft. These individuals represent 44 countries. They also have the right not to be concerned about having to look for a new job, as many “localised” products translated from English and adapted to markets in mainland Europe, the Middle East, and Africa, are produced in the city of Dublin.

There are close to 1,000 software companies in Ireland. Around 200 of these companies are from abroad and represent 90% of software-related revenues in the country. What the Chinese visitors are particularly curious about, however, is how local high-tech firms are emerging in a country where global software players are dominating.

Part of the reason lies in Dublin’s Digital Depot at the Digital Hub, located in a district called The Liberties. Another small business that resides here is Havok. It develops several products including Microsoft Xbox gaming consoles. Anyone visiting The Liberties will have the opportunity to see what an active economic policy looks like first-hand. State funds are bringing forgotten industrial sites back to life and semi-public business institutes are using venture capital to attract small businesses. There are also five- and 10-year economic plains in place aimed at preventing the government from pulling out in response to early disappointments.

In 2000, a conservative and business-friendly government led by Prime Minister Bertie Ahern, launched one of the largest urban redevelopment projects in Ireland, establishing the aforementioned Digital Hub. Investing 130 million worth of taxpayer money and with support from private sponsors, the government purchased several entire city blocks. Later, in 2004, it constructed a fibre-optic 3.5km long, which resulted in faster Internet speeds.

Ireland, which was also recently named the world's most generous country, has also enjoyed success away from the software industry, with software being just one part of of the fast-growing economy. Ireland's domestic economy grew by 8.2% last year and the unemployment rate is at its lowest since 2006.