KS Research Report 256060 – The Supplier Market for Digital Solutions in the Municipal Sector

About the report

Source: KS R&D Report 256060 – Oslo Economics and Capto
Commissioned by: KS
Conducted by: Oslo Economics and Capto

The report maps and analyses the supplier market for digital solutions in the Norwegian municipal sector, with deep dives into three market areas: administrative systems (ERP), welfare technology, and ePlanSak. The aim is to strengthen municipalities’ market position and improve the relationship with suppliers.

Key findings

• Concentrated market with limited competition: Municipalities hold hundreds of digital solutions, but most market areas are dominated by one to three major suppliers – including Visma, Tieto, Crayon, and Atea – leaving few real alternatives in procurement processes.

• Unwanted lock-in: Municipalities experience a lack of transparency into key solution properties, creating high switching costs and reducing their leverage at contract renewal.

• Untapped bargaining power: The report concludes that the municipal sector likely has more bargaining power than it realises or exercises. Regional and national coordination is the key to activating this power.

• Fragmented demand side: Suppliers experience municipalities as uncoordinated, with diverging requirements and unclear priorities, which hampers innovation and the scaling of new solutions.

• Varying procurement competence: Municipalities’ ability to conduct effective procurement varies significantly, and many make too little use of open specifications and market dialogue.

Recommendations

The report recommends that the municipal sector:

1. Increases coordination – regionally and through KS/KS Digital – to strengthen its negotiating position vis-à-vis suppliers
2. Conducts more systematic market dialogue and develops more open specifications focused on needs and value realisation
3. Demands greater transparency from suppliers regarding technical properties, integration interfaces, and data portability principles
4. Enables more suppliers – including smaller actors – to participate in procurement competitions

👉 Download the report (PDF) from KS.no

Relevance for SAMT-BU

1. The report documents structural market challenges that directly affect municipalities’ room for manoeuvre in SAMT-BU pilots: lock-in to legacy systems, the absence of open APIs, and weak data portability are among the concrete barriers to data-driven cross-sector collaboration.

2. The recommendations on coordination and open specifications align with the SAMT-BU approach of shifting power from suppliers to the sector through shared information models and standards for data sharing.

3. Use case 15 (Procurement of professional systems) can usefully draw on the findings of this report – particularly around requirements for open interfaces and avoiding lock-in as a prerequisite for coherent services.