IT Workshop Club

Russian independent software developers discussed staff shortages and promising markets

Years of development of the domestic software industry have brought with them serious changes. The evolution was evident at the ISDEF Spring 2008 (Independent Software Developers Forum) conference. Previously, the topic of general discussion was “how to open an account in an American bank.” Then - how not to lose to an American competitor in a patent war. Today - where to get people, and whether it makes sense to work in the Russian market.

Members of ISDEF (and the community’s work is constantly organized by Alexander Katalov from Elcomsoft) have been solving the state task of diversifying the Russian economy for a long time, at least for ten years, without attracting anyone’s attention. They have always worked on the world market, selling domestically produced software products via the Internet, while protecting their copyrights, and only recently came to Russia. ISDEF does not seek government support (and this is another difference between it and other industry non-profit associations), but, of course, ISDEF would like to feel attention from the government. When Dmitry Milovantsev, Deputy Minister of Information Technologies and Communications, sent a welcoming letter to ISDEF Spring 2005 participants three years ago, the conference received it with obvious enthusiasm. However, subsequently the officials did not complain about anything like that.

The personnel issue, the cause of headaches for the entire IT industry, is also facing ISDEF today. Although, perhaps, not as acutely as in the case of large software companies like 1C. “No one is doing this except us. That’s why people who don’t want to do anything else come to us,” says Ashot Oganesyan from SmartLine (the company operates in one of the narrow segments of the security systems market). “People don’t leave us for Moscow. They don't get tired of working for us. How can creativity get boring? - Yuri Uskov from Yoshkar-Ola (CPS Labs) demonstrates his cheerful attitude towards programming in a remark from the audience.

In addition to ways to satisfy the shortage of personnel, at ISDEF Spring 2008 the question of where it is better to do business was discussed - offshore or in full view of a state, for example the United States. It turned out that offshore business does not need. “For other purposes, like buying a couple of yachts, yes, it is necessary and even preferable, but it is harmful for business,” said Dmitry Dubograev (femida.us), an American lawyer who has long served ISDEF members, without meeting any objections. Offshore companies arouse suspicion among partners. The chain of companies required to sell from an offshore zone to a respectable customer requires more maintenance costs than can be saved on taxes. More arguments were expressed in favor of refusing to register companies in an offshore zone, but it turned out that there was something to oppose them. True story: a company owned by an ISDEF member decided to do business in Russia and at the end of the year honestly paid taxes on 250 million rubles. The tax authorities were amazed and began to look for arrears. They searched purposefully, taking up a lot of the businessman’s time. They found as much as 30 thousand untaxed rubles by mistake, after which they voluptuously fined them. “In the USA they love those who pay taxes” - this phrase of Mr. Dubograev met with either an ironic grin or a sympathetic sigh from the audience. In the same regard, software producers recalled the problems of the Eldorado and Tekhnosila sales networks and assumed that after defeating fly-by-night companies, the Russian authorities would show interest in offshore companies.

The interest in the relationship between ISDEF members and the Russian state is understandable - even working exclusively on the foreign market, most ISDEF businessmen prefer to live in Russia. But, besides this, Russia has recently become a promising market for software. This is what one of the meetings was devoted to. It turned out that the European market is “stagnating”, trading has become bad in the USA due to the low dollar exchange rate, but in Russia everything is fine: the market is growing. Dmitry Kurashev from Famatech (his company produces software for remote control of computers) says that Russia “has come out on top in sales.” Three years ago this would have been impossible to imagine. Among the CIS countries, the Kazakhstan market looks more promising than others (with the exception of Russia, of course). The rest of Central Asia is considered unpromising (“everything is corrupt there!”).

It is interesting that localization of software products into the Ukrainian language does not increase sales in this country - Russian confidently competes with the state language. As for Eastern and Central Europe, the former satellite countries of the USSR demonstrate greater loyalty towards Russian software. Sales in the Czech Republic or Poland bring in more money than, for example, the rich Italian market.

Andrey ANNENKOV, iToday, - specially for Vremya Novostei