Steppingstones or traps for developing the Bangladesh software industry

January 17, 2013

The wide-ranging and enthusiastic discussion that Katie participated in at a debate in Bangladesh in December raised several interesting points, among them:
• The focus to date in investment in Bangladesh has been on the hardware and infrastructure side and that the revenues being invested in software development itself are quite minimal in comparison. Relevant to this discussion was the question of whether this is a necessary phase marking proper market development or a trap that is diminishing the potential of the development of the software industry in Bangladesh.
• There is real issue of brain-drain in that well-educated, talented Bangladeshis are being sought out by global organizations seeking to boost their own talent pools. Often this means that these valuable resources are then leaving Bangladesh either temporarily or permanently. The panel grappled with this topic noting that the absence on the domestic market of these resources can constrain the speed of market development yet the diaspora of Bangladeshi talent can feed global market development and connections while also bringing back to Bangladesh valuable skills, experiences and networks.
• Free and Open Source Software is a clear entry point for Bangladeshi software developers as it comes with lower barriers of entry, is gaining in market share in many market segments, is disproportionally represented in several growth areas of ICT, and is regarded positively in the developing world, primarily Asia. However, the panel discussion confronted the question of whether an over reliance on FOSS will mean less business down the road as large customers with large budgets are underrepresented in the current buying pool.
• The explosive growth of free-lancing and dis-aggregated technical resources is having a transformative effect on Bangladesh. It was reported that not only have 250,000 Bangladeshis signed up for one of these freelance platforms, among them Elance and oDesk, but that close to 30,000 per month are currently doing so. While this development means that resources are in principle much closer to the buyer and that many more young and talented Bangladeshis can participate in the global ITC market, it also means that institutional career and skill development, not to mention access to large projects is mostly sacrificed by these same young and talented Bangladeshis. Whether this move to the freelance model is a phase or a permanent condition both for the market and for these professionals is not yet known but will certainly influence the development of the software industry in Bangladesh.
• Low-price as the competitive advantage brought an interesting discussion as it is clearly a resonant and critical attractor for the current Bangladesh software development industry. However, being the low-price provider is unsustainable over the long term if Bangladesh is also going to meet its ambitious goals of vastly growing its middleclass over the coming 8-10 years. Therefore, Bangladesh should exploit the opportunity that it currently has in the price “battle” but needs to begin to position its software industry on additional criteria so that it can build a sustainable, long-term, value-adding software industry.

In summary, the panel discussion grappled with each of these topics and asked the question as to whether these elements are stepping stones for building a robust software development industry or traps that will limit and constrain. Although the panel brought fourth differing opinion on many of the discussion points, one thing that the panel was in agreement on was that open and deliberate discussion on all of these points in the wider Bangladeshi business, political, academic and ITC communities will be the only way to ensure that the Bangladesh software industry has a positive future and is a valuable contributor to the overall growth of Bangladesh.