Option "L"

Manufacturers say the bottom has been reached in the mass software market

Last weekend, Moscow hosted the next conference of ISDEF (Independent Software Developers Forum) - an organization that unites people (namely people, membership in the organization is only personal) from Russian software companies operating in the mass software market. Most of them represent not very large, but truly independent software companies. Working on the global or domestic, but truly mass market, selling software and most often using the Internet, these companies feel economically free in Russia.

This year the association suffered its first losses due to the crisis. If last year's event had 350 participants, now there are about 250. The conference organizers say that many were unable to come to Moscow simply because there was no money for the trip.

ISDEF, meanwhile, is becoming more and more like a club, and not an association aimed at solving business development problems. There is a definite advantage to this. The forum stands apart from other industrial alliances, which may, for example, jealously compete with each other for the right to represent the IT industry before the state. ISDEF doesn't care about such nonsense.

The current chairman of ISDEF, Felix Muchnik (CEO of Softkey, one of the country's largest software sellers), opened the conference and used the words “we survived the crisis,” but did not back up this statement with numbers. From conversations with the participants of the meeting, it became clear that the market has indeed now “reached a plateau.” IT expert Mikhail Elashkin believes that now the crisis is developing according to option L. Stability after a recession with a slow recovery - the development schedule coincides in shape with the letter L. Felix Muchnik says exactly the same thing. But the decline in the market for mass-produced (i.e., distributed in boxes or online) software during the crisis year was significant - from 30 to 50%.

"We tried to do some good"

This expression was used by Deputy Minister of the Ministry of Telecom and Mass Communications Dmitry Severov, who came to ISDEF-2009. The ministry had many undertakings. Thus, according to the deputy minister, the Ministry of Telecom and Mass Communications tried to adjust a certain order of the Ministry of Economic Development in order to give preferences to Russian software companies. They also tried to clarify Law 94-FZ “On placing orders for the supply of goods, performance of work, provision of services for state and municipal needs,” namely, in order to clarify the term “Russian origin” in relation to software. They were concerned about reducing insurance rates for software manufacturers (they even reported this issue to the president, who, as you know, is an “IT enthusiast”). They were busy trying to simplify currency control procedures so that fewer documents would need to be completed for transactions of less than $5,000. And, oh, “happiness,” they established Programmer’s Day in Russia.

To the question of our correspondent about what, in addition to the introduction of Programmer Day, was actually done, and not just done, the Deputy Minister answered this way: the bureaucratic machine consists not only of the Ministry of Telecom and Mass Communications, we did our part of the work, “the word belongs to the respected non-core departments,” and the question this “needs to be maintained in the public sphere.”

Russia dissolved in Eastern Europe

Digital River is the largest software registration service. It is this company that provides the software developer with the opportunity to offer the results of their work to the whole world for online purchase. The service was represented by Tatyana Franke (commercial director of share-it - the company is part of Digital River) and vice president Mark Iverson. Their report was interesting: hardly anyone knows the global market for mass software better than they do.

The map on which Digital River depicted software sales points is similar to space images of the night Earth: illuminated cities are concentrated in the USA, Europe, continental Southeast Asia, Japan and in some places (in Australia, for example) on the ocean coasts. Software consumption in Latin America is growing noticeably.

As for software manufacturers, everything is different. Programs are produced not only where they are consumed. Most of the software sold at retail through Digital River is produced in the United States. Then comes Europe. Canada is becoming a significant player. Indians are increasingly moving to Europe, and “trying to understand it.” This means, by the way, that “stupid” Indian coders want to deprive “smart” Russian programmers of their original competitive advantage - mental proximity to the Western customer.

Digital River did not find a separate presentation slide illustrating the geography of consumption of software produced in the country for Russia (unlike the USA, India, China and even Canada). Our country was included along with other countries in the “Eastern Europe” category. Although in Russia Digital River has 3 thousand software producers (companies and individuals), which is 11% of the total.

Who buys software in Russia

Softkey, which estimated the Russian replicable software market at $2.3 billion in 2009, presented the results of an annual study on the topic “Portrait of a User” (more precisely, a buyer). The survey involved 18 thousand respondents - 15 thousand individual and 3 thousand corporate - software buyers.

Based on this study, we can talk about interesting trends that have emerged.

Firstly, software legalization has ceased to be the most important factor in market development. This year there are 5% fewer people who believe that all software on their computer should be licensed. Among companies with over 500 employees, only 60% use only legal software. The rest steal or steal.

This should be recognized as the most severe consequence of the crisis. Several years of hard work by the state and industry have led to Russia becoming the first in the world in terms of the rate of decline in piracy. Now all this is lost. We are back in 2005. The correct term for this situation is feralization.

Secondly, the digital divide is worsening in the country. If a year ago 43% of Softkey sales (the company sells only software) were sold in St. Petersburg and Moscow, and in the regions, respectively, 57%, but now the regions account for only 50%. This is also an extremely unpleasant consequence of the crisis, the elimination of which will take many years.

Thirdly, the share of Linux among operating systems installed on home machines is growing. It reached 9% (the share of households where Linux is installed on at least one computer), which should be considered an excellent result. But this success is not ensured at all by Windows, which still owns the same 99%. Linux is not installed as a replacement, but on a second computer or purchased along with a netbook.

The strategic success of Linux is associated, among other things, with the level of piracy. The lower it is, the better free software feels (this is what this operating system refers to). That is why we cannot expect decisive successes for Linux in the near future.





Prepared jointly with iToday.ru

Andrey ANNENKOV, iToday.ru, - specially for Vremya Novostei