The fall in software exports and the growth of income from import substitution – preliminary results of the year from the IT association RUSSOFT
RUSSOFT’s press conference, at which experts – representatives of companies from the association spoke about the changes that have taken place this year in the IT industry, was held the day before in Moscow; the main topics were the technological sovereignty of the Russian Federation and the export of Russian software.
Speaking about the preliminary results of the year, RUSSOFT President Valentin Makarov notes a sharp drop in software exports, and especially software development services, against the backdrop of growing income from import substitution. Makarov suggests that total industry sales increased by a few percentage points in 2022.
In July, we recall, the organization reported that foreign sales of Russian developers in 2021 amounted to 745 billion rubles ($10.1 billion). In 2020, the value of this indicator evaluated at 8.6 billion dollars.
Serious changes have also taken place in the labor market – a general decrease in the size of the software development community against the backdrop of a decrease in the shortage of personnel; the emergence on the labor market of highly qualified specialists from the development centers of foreign corporations that have moved abroad, Makarov notes.
Pavel Kalyakin, General Director of MyOffice, Elena Bocherova, Executive Director of Cyberprotect, Andrey Sviridenko, Chairman of the Board of SPIRIT, Andrey Shastin, Director of Strategic Initiatives and Partnerships of Auriga, and Lev Matveev, Chairman of the Board of Directors of SearchInform, also made presentations at the event. for TrueConf Development Dmitry Odintsov, CEO of IBS InfiniSoft Sergey Rezontov, Deputy Director of Business Development Department of Innotech Group Andrey Gulidin.
Pavel Kalyakin (MyOffice) noted that the departure of foreign vendors from Russia led to an increase in the load on the information security departments and a violation of the internal processes of companies built over the years. Business and government organizations are more actively switching to Russian products. MyOffice records an increase in the number of pilot projects [внедрения продуктов компании]: for the ten months of 2022, their number was 181 against 58 last year. As examples of a “comprehensive case in the Russian IT industry this year” is the transfer of all VTB Bank employees to MyOffice office software and the integration of the MyOffice solution into Mail and Cloud Mail.ru.
Sviridenko (SPIRIT) believes that in order to rapidly increase the export of domestic software to the countries of Southeast Asia and the Middle East, state grants are needed to promote and search for new local partners. The available tools in the RFRIT and the Bortnik Fund are not enough, investments are needed from large companies, state-owned companies and banks.
Andrey Shastin (Auriga) spoke about the increased number of requests from Russian companies for the development of complex products / systems, with allocated funding, but with a lack of understanding of the product development cycle. The main difficulties in working on such projects are the underestimation of the need to analyze the technical and functional requirements for the product, prototyping, automated testing; lack of long-term planning.
Lev Matveev (SearchInform) believes that for successful export it is necessary to offer foreign partners not only a product, but also a full range of services – services related to software, assistance with training specialists to work with it. In addition, the so-called. “digital attaches» should have a higher motivation to promote Russian software abroad, and exactly 1-2% of sales.
Dmitry Odintsov (TrueConf) said that many countries remain loyal to Russian software and strive for independence from American technologies, which from 2020 to 2022 became one of the elements of the sanctions machine. The demand for sanctions-protected Russian video conferencing solutions in government departments, law enforcement agencies and large businesses in other countries has grown by an average of 30%. Export is necessary for Russian developers, because in our country there is a small audience, especially “paying”.
Experts noted that Russian developers are now focusing on the markets of the EurAsEC, ASEAN, the Middle East, Latin America, and Africa. To date, the main problems of these markets are low solvency and the lack of a sufficient mass of competent personnel to develop and consume modern solutions. According to Makarov, these problems necessitate complex deliveries of B2G platform solutions on a turnkey basis; provision by the seller of lending to IT platforms in “friendly countries”; training local staff to work with these solutions and offering a new “friendly” business model instead of the quasi-colonial one offered by the outgoing leaders of the previous technological order.
“The sphere of information security in Russia has proved that we can be leaders here and export technological sovereignty to other countries. It is on cybersecurity platforms that other Russian applications of the New Technological Order should be built and promoted on the global market,” Makarov summed up.
See also: Why does Russia need IT exports?
Forecasts of RUSSOFT participants for the coming year:
- the rapid growth of the need for personnel, the return of the shortage of personnel;
- growth in sales of software and services in the Russian market due to import substitution against the background of a partial return of foreign vendors to the market;
- giving IT export the status of a state policy priority and a significant increase in exports to “friendly countries”;
- initiation of strategic cooperation in the field of IT in the BRICS+ countries, formation of the BRICS+ market.
In August, we recall, RUSSOFT sent to the Ministry of Digital Development a roadmap for the development of exports of domestic software.
The Association proposes that the Ministry of Industry and Trade, together with the Ministry of Digital Development, create IT centers in the countries of presence by July 1, 2023 to provide jobs, co-working spaces and infrastructure to accommodate representatives of Russian companies.
Much attention in the roadmap is given to the marketing of Russian software abroad and the promotion of our software imports abroad. For example, grant support is expected to compensate for the costs of software promotion in friendly countries, financial support for the creation and operation of foreign websites of Russian IT companies, etc.
Valentin Makarov about personnel
The development centers of foreign companies changed jurisdiction, which were obliged to do this legally, obeying the laws of their, as it turned out, “unfriendly” countries. Prior to the start of the NWO, they accounted for up to 10% of all Russian exports of software and software development services.
For exporting companies with Russian ownership, we can rather talk not about a change of jurisdiction, but about the creation of sales centers in the jurisdiction of other countries, which makes it possible to work with foreign clients and receive payments from them for the work performed.
The outflow of IT specialists was observed in the first 3-4 months after the announcement of the CBO. Then the number of people leaving and returning to the country leveled off, and then the outflow turned into an inflow. And so – until the announcement of partial mobilization, which provoked a new surge in the departure of IT specialists. Fortunately, it was decisively stopped by the actions of the Ministry of Digital Development and the government to free IT specialists from mobilization.