russian software developing industry and software exports

Chapter 4.
AVAILABILITY OF UP-TO-DATE
INFRASTRUCTURE
Based on the results of the poll, the IT infrastructure
has significantly improved over the last year. The share
of «poor» evaluations decreased from 52% to 20%
while «good» increased from 6% to 21%. Indeed,
in 2008 certain positive changes were observed:
the launch of new business centers (performed
with varying degrees of intensity), investments
made in special economic zones, technology parks,
state corporations, roads maintenance, expansion
of communication channels and construction of
the elements of the system of power supply and
distribution.
Such gradual improvements were registered in
the previous years as well, but the results of the poll
showed that in the best case business saw just little
progress. Last year’s evaluations were similar to the
previous year. It may be assumed that a consistent
growth in the volume of investment in infrastructure
at a certain point led to qualitative changes in their
evaluation by business.
Another essential achievement is the changes in
the market of Internet access services, mainly in the
big cities. The speed of traffic has hugely increase
followed by the reduction in tariffs. The year before
the crisis leading providers were completing their
networks in major cities.
The crisis produced a major impact on the
reduction of rental costs for office premises. The lease
of premises is the second major item of expenditure
(after salaries) for software companies. Moreover,
lease rates in major Russian cities were 2-3 times
higher than in business centers in Western Europe.
The growth in demand for quality office premises
was lagging behind the launch into operation of new
buildings. As a consequence of the crisis the demand
for the lease of office premises sharply decreased
followed by the reduction in prices. For instance,
in Moscow the lease of an office of medium quality
dropped approximately 4 times. The reduction in
prices is not equal all over Russia, but it is significant
anyway.
The reaction of respondents to reduced lease rates
proves that dissatisfaction of software companies
with the state of infrastructure is probably has to do
with the quality of the latter, rather than the cost of
services required to maintain this infrastructure.
Companies could get the services of the required
quality already long ago. But previously they were
irritated and displeased with their cost (especially as
far as the lease of offices is concerned). The level
of this dissatisfaction could be measured owing
to the crisis.
A major reduction in «poor» evaluations was
recorded for all companies in spite of their location,
turnover and revenue structure. For all groups the
share of «poor» marks radically decreased and stays
within 13-25%. We can mention a slightly bigger
proportion of «good» marks for St. Petersburg
companies as well as companies with the turnover
more than 20 MUSD, but these deviations may
be caused by hopes for improvement related to
intentions or actions of the State to create special
economic zones. For example, last year there were
more «poor» evaluations of infrastructure made by
St. Petersburg companies than by representatives
of other cities. During the year there were major
developments in infrastructure that could have
promoted the North capital from the last to the
first place by infrastructure conditions to exclude
the emotional reaction to the information about the
implementation of projects of the special economic
zone and the Technology park.
The crisis made the Government change its attitude
to those investors who stayed in the city after the
crisis. Thus, the management of the Finnish company
Technopolis is now confident that the first phase of
their Technology park will be launched into operation
in Q2 2010. Its total area will be 23,800 sq. m, and the
area of premises leased – 18,000 sq. m. Technopolis
considers an opportunity to build a network of
Technology parks in Russia.
The good news is the progress in the development
of technical and innovation Special Economic Zones
(SEZ). These include 4 zones in: St. Petersburg,
Zelenograd (this city has a status of a Moscow district),
Dubna (Moscow region) and Tomsk. Infrastructure
facilities and administrative buildings are under
construction, and companies are granted the status
of residents (therefore, they may build their facilities
and enjoy the rights of residents and tax privileges).
60%
50%
40%
30%
20%
10%
0%
Overview of Business Environment
for Software Development in Russia
52%
Poor
Evaluation of existing infrastructure
42%
2008
6%
20%
Satisfactory
60%
2009
21%
Good
FINANCIAL SUPPORT TO SMALL
BUSINESSES AND START-UPS.
INVESTMENT FUNDS
For 2/3 of respondents financial support of small
business and start-ups is insignificant or almost nonexistent.
The results of the poll concerning this type
of support practically remained the same in the past
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