IT Development

 

The scientific research and computer services industry expanded strongly in Northland over the last decade, with output increasing on average by 8% per year.  The baseline forecasts are for this pace of growth to fall to just 0.7% pa.  The accelerated growth provides for scientific research and computer services to double in size every ten years. 


Other education was also include in the Science and IT industry given the close links between tertiary education and scientific activity.  The accelerated growth allows for 30% increases in other education every ten years.

 

There are number of projects to develop a strong IT sector in Northland in the planning phase. One project that is about to be launched is the E-commerce Project led by the NZ Communities Development Trust.

 

The E-commerce Project

This project is committed to maximising the number of Northland businesses able to undertake commercial activities online by  lowering the threshold cost and complexity of setting up an Internet presence. It is the intention to provide e-commerce engines and content websites at a fraction of the normal cost.The objective is to make Northland the most wired region in New Zealand.

 

Creating an environment where businesses and community groups can easily promote themselves, do business, or share information will also create many more opportunities for web developers to build more comprehensive web sites embracing product directories and e-commerce, or other advanced features.

 

There are about 12,000 businesses operating in Northland the majority are small (less than five employees), part time (e.g. Bed & Breakfasts in the tourism sector), or “lifestyle (and hence growth resistant) businesses. As a consequence, the potential for significantly impacting Northland’s prosperity, currently sits with a very limited population of competent, profitable, growth capable businesses. With a population of approximately 158,000 spread through urban and rural communities on a land area of 13,800 sq km the  business scale in the local  market is limited. In addition the huge geographic spread of the region means the local market potential is even more limiting. If we assume the extreme reach of commuting or traveling to a business is 60 minutes the number of potential customers in anyone 60 minute commute radius is very limited.

 

It is also estimated that the penetration of online B2C and B2B activity is only about thirty percent across the country with rates expected to be lower in Northland. If 1000 businesses are provided an e-commerce resource for a small nominal fee or in some cases free this will equate to a four million injection of capital into providing Northland businesses  the ability to reach a larger market for a relatively small development investment.

 

There is no limit to the number of businesses that can access this opportunity so the potential capital value to the region could be in excess of $16 million with a fifty percent acceptance rate. If each business conservatively grew their revenue conservatively by $5000 per year using this facility it would equate to  $22.5 million coming into the region.