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Microsoft and IDC Announce Economic Impact Study

19 October, 2007 | Archived Post

Independent research shows Microsoft-related businesses make $11 for every $1 Microsoft earns1.

Sydney, Australia - Oct. 19, 2007 - Spending on information technology in Australia is predicted to create more than 40,000 new jobs over the next four years and create more than 1,200 new IT companies, according to a new global study released by International Data Corporation (IDC). The research predicts that in 2007 Microsoft-related activities will be responsible for 128,000 jobs from an IT industry total of 320,000 jobs – 40% of total IT employment in Australia.

“Today, technology is a key factor for economic, social and technological progress, and for the sustainability of economies all over the world,” said Mr John Gantz, IDC's Chief Research Officer. “The IDC research underscores what we've always known to be true, that software provides a disproportionate contribution to a vibrant IT economy. It also shows the significant contribution made by the Microsoft ecosystem, especially in the creation of local businesses and local jobs.”

The independent research, which was commissioned by Microsoft, examined the IT industry’s impact on local job creation, company formation, and tax revenues in 82 countries, representing 99.5% of the total technology spending worldwide. IDC found that IT spending on software creates a disproportionate share of the skilled job growth. Software drives activity in the services and distribution sectors, as well as in organisations using IT, so while Australian spending on packaged software will be only 16% of total IT spend in 2007, 40% of IT employment in Australia will be software-related.

The study also showed that the Microsoft ecosystem – defined as people working at IT companies and IT professionals who create, sell, or distribute products that run on Microsoft platforms – plays a key role in driving the IT industry's overall contribution to job growth and economic development.

Ms Tracey Fellows, Microsoft Australia’s Managing Director, said IDC’s research found that Microsoft serves as an economic catalyst for the IT industry in Australia.

“The revenues earned by companies working with Microsoft far exceed the revenues earned by Microsoft itself,” said Ms Fellows. “The research found that for every dollar of AUD revenue in Australia in 2007, companies working with Microsoft will earn almost $11. Clearly, the Microsoft partner ecosystem is helping people find jobs, create new businesses and expand their existing businesses.”

Overall IT spending is expected to hit $30.75 billion in 2007 and grow 3.6% per year between now and 2011. Additionally, the survey found that over the next four years, Australia’s IT industry is expected to contribute new revenues of $11 billion to the country’s GDP. Investments by the Microsoft ecosystem, including infrastructure, people, marketing and business development, is expected to be more than $2.114 billion in 2008, according to the survey.

According to CEO of local partner Dataract, Craig van Zeyl, “Optimising back-office processing through workflow requires highly sophisticated application platforms. Our decision to move from the traditional platforms to SharePoint and to embrace Microsoft as both our technology and go to market partner has proved successful far beyond our expectations. Microsoft’s assistance during the redevelopment of our business, assistance in helping us gain market traction and now co-operative planning to expand our business has been invaluable. We believe that adopting this leveraged business model, where we incorporate both Microsoft technology and Microsoft business processes, has been the reason for our success.”

About IDC Methodology
This study applies IDC's Economic Impact Model, which assesses the IT industry's impact on job creation, company formation, local IT spending, and tax revenues in addition to assessing Microsoft's partner ecosystem. The study's spending figures accounted for hardware, software, services, and data networking expenditures by consumers, businesses, governments, educational institutions within each country. Tax revenue figures were based on potential VAT or sales tax revenues from the sale of hardware, software, or services, as well as business and personal income taxes and social taxes. IT employment included the number of people employed (full-time equivalent) in hardware, software, services, or channel firms, and those individuals managing IT resources in an IT-using organisation (e.g., programmers, help desk, IT managers, etc.). All data was cross-checked against published information and census data available from government sources and validated by local government officials. Information about how to obtain a copy of this report please visit:

About Microsoft Australia
Founded in 1975, Microsoft (Nasdaq "MSFT") is the worldwide leader in software, services and solutions that help people and businesses realise their full potential.

Microsoft, Windows and Windows Media are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.
The names of actual companies and products mentioned herein may be the trademarks of their respective owners.

For more information please contact:

Ms Clair Deevy
Public Relations Manager
Microsoft Australia
Ph: 02 9870 2508
Mobile: 0404 090 292

Ms Sarah Treharne
Howorth Communications
Ph: 02 8281 3855
Mobile: 0430 016 901

Note to editors: If you are interested in viewing additional information on Microsoft, please visit the Microsoft Australia Web page at on Microsoft’s corporate information.

1The exchange rate is based on an average exchange rate for 2006 of 0.752713298160956.


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