Expert opinion on the challenges Russian IT companies are facing abroad

Director of the Center for Global IT-Cooperation Vadim Glushchenko has spoken on the challenges Russian IT companies are facing abroad and the opportunities provided for those who opted against relocation.

“It is no secret that competing with foreign counterparts and entering foreign markets have always been a challenge for our IT companies. It’s not really about whose product is more hyped or in greater demand; it’s about marketing issues, high taxes, and a number of administrative hurdles often caused by political factors. Successful Russian competitors have been kicked off the market by hook or by crook. Think about the campaign launched against Kaspersky Lab by the UK and the USA in 2017,” the expert says.

Let us remind that in 2017, the UK’s National Cyber Security Centre banned the agencies responsible for national security from using the Kaspersky Lab antivirus and warned other departments against doing it as well. Heads of departments were notified that cybersecurity software made by Kaspersky Lab posed a threat amid mounting concern about Russia’s attempts to spy on Western countries. In the same year, the U.S. Department of Homeland Security ordered government departments and agencies to remove all Kaspersky Lab software from their computer systems. The U.S. House Committee on Science, Space, and Technology sent a letter to 22 federal agencies requesting all available information regarding the Kaspersky Lab company’s activities on the territory of the USA. Members of the U.S. Congress stated that the company was suspected of carrying out “nefarious” activities against the United States. Such reaction of the U.S. Congress was triggered by the company’s head Eugene Kaspersky’s announcement of the launch of Kaspersky Free, a new antivirus.

Vadim Glushchenko points out that now it will be even harder for Russian IT companies to operate abroad.

“Now, it will be even harder for Russian IT companies to both start operations and scale their businesses abroad. Many of those who have relocated say that, under new circumstances, getting a new job abroad is extremely difficult, even for highly qualified experts. In Europe, the local population’s bias against Russians and the outbreak of Russophobia have played their part. When applying for a job or moving up the career ladder, the preference is given not so much to the locals as to those who don’t have a Russian passport,” the expert states.

He also recalls that those who work in Russia are provided with numerous favorable opportunities to run a business safely.

“That said, the unique conditions provided for the Russian IT industry in the home country are worth considering and require a pragmatic approach. It is impossible not to notice the way the government is trying to ensure the most comfortable work environment for both companies and employees. In 2020 and 2021, two packages of measures were adopted to support the IT industry; the third package is being prepared; in March, granting additional benefits was approved as well. Not only does the government engage in a constant dialogue with the industry, recognizing and analyzing its needs, but it has also learnt to respond quickly when problems and challenges arise. And there is no doubt that the withdrawal of certain major foreign players from the Russian market has allowed our IT companies to improve competitiveness and develop and implement new products,” the expert says.