Most of the software and technology solutions used in Brazil is developed abroad, but foreigners are approaching the country more and more as the market keeps expanding. The use and consumption of technology is growing everywhere, every year. And it is no different in Brazil.
In 2013, the Brazilian market of IT and Communications – known in Brazil as TIC, or Tecnologias da Informação e Comunicação – accounted for USD 222,6 billion according to data from Associação Brasileira das Empresas de Software (ABES, or Brazilian Association of Software Companies).
There are many explanations for this increment: higher demand by domestic companies, more diversified use of technology solutions and even more imports of TIC goods. Brazilian companies are requiring a growing amount of devices and software to manage its digital resources, sales, market and innovation processes.
In fact, a large part of these needs is being supplied by foreign goods. Many TIC items are simply not produced in Brazil, which led to an import tax rate reduction for some of them, stipulated in 2014 by Câmara do Comércio Exterior (Camex, or Foreign Trade Chamber). Among the items included were switches used in data centers and equipment used to distribute video content through the TV or internet.
Brazil is a large importer of TIC, especially software. Nearly 77% of all the software used in the country is developed abroad. Services, however, are mostly offered by domestic companies: only 0,7% are provided by foreigners.
Although Brazil is a large market for TIC goods, the differences between each region are striking. ABES data shows that the southeastern region is, by far, the most consolidated and promising one. Around 56,1% of TIC companies are located in the Brazilian Southeast – formed of the states of São Paulo, Rio de Janeiro, Minas Gerais and Espírito Santo – and this region represents almost 64% of the national market.
Northern and northeastern regions are the ones with less representation in the Brazilian TIC market, even though there are some exceptions, like the states of Bahia and Pernambuco. Both regions together represent a little more than 10% in the national market.
Data from the market research company Gartner and further analysis by TI Maior, the Brazilian government IT strategic program, shows that the areas which will receive and demand wider investments over the next few years are:
- Mobility and ubiquitous computing
- Niche applications
- Web, system architecture, integration of legacy systems and middleware
- Outsourcing and remote administration
- Infrastructure and cloud computing
- ERP, BI and CRM
- Open platforms
- Embedded solutions
- Education and knowledge management
Trends and forecasts
The market for ICT has been growing recently and the general expectation is that this movement will continue to grow over the next few years, just like the global market.
As previously mentioned, Brazil depends heavily on foreign products, especially on foreign software. However, the gap between solutions produced locally and abroad is gradually narrowing. In 2013, for example, the use of local software grew 15,3%, while the growth of foreign solutions increased by 12,9%.
Associação Brasileira das Empresas de Tecnologia da Informação e Comunicação (Brasscom, or Brazilian Association of ICT Companies) estimates that the IT market will keep its expansion process in the future, reaching USD 253,3 billion by 2022. This figure does not consider communications, but gives a solid overview of what the sector is expecting over the next few years.