Russian IT Quarterly. Issue #21, October, 2009
The prospects of a Russian Silicon Valley
Oct 15, 2009
The last few months have been subdued, even by the drowsy standards of summer. This has been compounded by the wait-and-see attitude of the business community looking forward to signs that the market has reached the bottom and is rising again.
The only visible sign of life has been the frantic efforts of rival service providers to secure contracts, apparently with little thought for the long-term viability of their loss-leading activities.
The Russian market stirred to life last month in a flurry of high-profile marketing activities organised by the government. Innovation Week saw a series of conferences and exhibitions take place in Moscow and St. Petersburg, and it was against this backdrop that President Dmitry Medvedev emphasised his latest economic strategy — changing the course of the country from natural resource supplier to high technology provider.
In essence, the Russian government is pursuing a truly ambitious aim — to create a new Silicon Valley on Russian soil, a production center for new high-tech products and technologies, headed by the state-owned Rosnano Corporation.
How realistic is this?
On the one hand, the pool of Russian high-tech products is quite shallow at the moment. These include military, space and nuclear energy technologies along with a few names like Kaspersky, SPIRIT and Abbyy.
However, Russia possesses a good nutrient solution to grow the innovations reef. Besides the famously high quality of Russia's technical education, the last ten years have seen the emergence of new IT and telecom service companies capable of working with both domestic and overseas enterprises. This seems to be a solid grounding for any successfully developing IT and innovations industry. Service companies working for a broad range of clients accumulate the best business practices, knowledge of business processes and best technology solutions. They become a source of knowledge for the domestic market, breeding highly competent personnel with rich, transferable skills, who are able to set up their own product companies or enhance existing ones. Service companies can also become the launch pad for various start-ups, as Reksoft was at an earlier stage of development, when the company developed Russia's most successful online retailer, the country's first internet payment gateway and a leading hospitality ERP system, alongside a number of niche products.
From this point of view, the prospects for a Russian Silicon valley look positive.
However, as we know, the nutrient solution is not enough to create life. A benevolent Creator must create the spark - in this case, entrepreneur activity.
The only visible sign of life has been the frantic efforts of rival service providers to secure contracts, apparently with little thought for the long-term viability of their loss-leading activities.
The Russian market stirred to life last month in a flurry of high-profile marketing activities organised by the government. Innovation Week saw a series of conferences and exhibitions take place in Moscow and St. Petersburg, and it was against this backdrop that President Dmitry Medvedev emphasised his latest economic strategy — changing the course of the country from natural resource supplier to high technology provider.
In essence, the Russian government is pursuing a truly ambitious aim — to create a new Silicon Valley on Russian soil, a production center for new high-tech products and technologies, headed by the state-owned Rosnano Corporation.
How realistic is this?
On the one hand, the pool of Russian high-tech products is quite shallow at the moment. These include military, space and nuclear energy technologies along with a few names like Kaspersky, SPIRIT and Abbyy.
However, Russia possesses a good nutrient solution to grow the innovations reef. Besides the famously high quality of Russia's technical education, the last ten years have seen the emergence of new IT and telecom service companies capable of working with both domestic and overseas enterprises. This seems to be a solid grounding for any successfully developing IT and innovations industry. Service companies working for a broad range of clients accumulate the best business practices, knowledge of business processes and best technology solutions. They become a source of knowledge for the domestic market, breeding highly competent personnel with rich, transferable skills, who are able to set up their own product companies or enhance existing ones. Service companies can also become the launch pad for various start-ups, as Reksoft was at an earlier stage of development, when the company developed Russia's most successful online retailer, the country's first internet payment gateway and a leading hospitality ERP system, alongside a number of niche products.
From this point of view, the prospects for a Russian Silicon valley look positive.
However, as we know, the nutrient solution is not enough to create life. A benevolent Creator must create the spark - in this case, entrepreneur activity.