Launch of a “private investment software company” with the participation of large companies

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Discussion of “3 cases” between public institutions and large companies
For projects with more than 50% of the private load
From the first half of next year, the “first fruits”

The “Private Investment Type SW Project” to increase opportunities for large companies to participate in the public software (SW) sector has taken the first step. The first results are expected for next year. According to the Ministry of Science and ICT, three private investment software projects (hereinafter referred to as private investment SW projects) are under discussion between public institutions and large IT service companies.

The objective of “Private Investment SW Projects” is a SW development project in which the proportion of the private sector is greater than 50% of the total project cost. It was introduced at the end of last year thanks to the improvement of the system for restricting the participation of large companies (track 3). The expected effect is to guarantee an insufficient budget for public institutions to improve services to the public and to increase the opportunities for large companies to participate in public projects.

As this is the first case, we know that the project under discussion is not large-scale since it is a pilot project. Once the discussion is completed, a deliberation will take place to determine whether it is possible to participate in large companies as a “private investment SW project”. The first contract is expected to be signed in the first half of next year at the earliest, with follow-up procedures such as tenders.

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The recognition of exceptions to the restriction of the participation of large companies is only made in the fields of national security or equivalent activities (Track 1), and the introduction of new technologies such as artificial intelligence (AI ) (Track 2). If the case materializes in the “private investment SW project”, large companies are expected to participate in various ways. The Ministry of Science and ICT plans to support the expansion of the results of privately invested SW projects in many institutions. They plan to use the “professional digital service contract system”.

The Digital Services Specialized Contract System, introduced last year, is a system that allows cloud-related products and services that have passed deliberation to be registered in the public procurement department’s mall and to be introduced through research and private contracts. Although the “private investment SW project” is the development of custom software for a specific institution, it can be converted into commercial software with certain changes. It is possible to move from a “private investment SW project” to a “private investment commercial SW project”, and large companies can realize additional benefits. It also coincides with the speech of the Ministry of Science and ICT, “Software-centric SW industry business innovation”. On 3, Min-young Cho, head of SW industry at the Ministry of Science and ICT, said: specific institutions but also other institutions. Linking with the specialized digital services contract system will help disseminate the privately invested SW project. “

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The Ministry of Science and ICT will also prepare guidelines for private investment SW projects during this year. The objective is to revitalize the system by informing the client and the large IT services companies of SW projects with private capital, and to provide them with a reference when the project is carried out. The necessary details for private investment SW projects such as procedure, method and period will be included. They have also started discussions with the Korea IT Service Industry Association. Hyo-geun Chae, Vice President of the IT Service Association, said: “There are many government-led projects, and because the role of the private sector needs to be strengthened, the private investment SW project has a lot of meaning in this regard. He continued, “Various activities aimed at revitalizing the ecosystem and improving private profits should be possible on the basis of the system, such as the creation of an investment association or the formation and participation in a consortium with SMEs. “

Overview of the private investment type SW project system

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By reporter Ho-cheon An ([email protected])


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