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IBM Russia

Company

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The first representative office of IBM in the USSR appeared still in the early seventies. The interests of IBM in Russia are represented by IBM Vostochnaya Evropaaziya LLC company.

Owners:
IBM
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Assets

Owners

+ IBM Russia (IBM Eastern Europe and Asia)

The interests IBM in Russia are represented EuropeAsia by IBM Vostochnaya / LLC company.

Performance Indicators

2019: Revenue of the Russian office IBM grew up in rubles, and profit was reduced

According to base "Circuit. Focus", in 2019 revenue of the Russian legal person IBM – "IBM East Europe/Asia" ("IBM VEA") – increased by 4.3%, to 10.69 billion rubles year-on-year. The profit of the company for the same period was reduced by 8.2%, to 2.9 billion rubles.

Recession of this indicator took place after its small growth in 2018. And IBM VEA had the largest net profit during all the time in 2015: then it made about 5.6 billion rubles.

Do not comment on regional financial performance in IBM and do not open them in dollars. At the same time, at the Russian office of the company designated the main directions in which in reporting period work was conducted. Iris Dzeba, the CEO of IBM in Russia and the CIS countries, reported to TAdviser that in 2019 IBM "helped customers from among leading companies with Russia" to take advantage of advanced local and cloud IT solutions on the basis of artificial intelligence, a blockchain and other technologies which they used in the course of digital transformation of business processes and development of the new directions of business. In the majority of such cases technology or business consultation from IBM was an integral part of projects, she added.

Among such projects – creation of the self-training program, joint with Scientific and technological center of Gazprom Neft, for search of additional oil reserves, development of the platform on tokenization of industrial assets of Atomyze for Norilsk Nickel, implementing solution for automation of distribution of pilots by runs in Aeroflot.

In 2019 IBM VEA did not sign direct contracts with state customers' '(a photo - gpj.co.uk)

On clouds and artificial intelligence, in particular, the company placed a particular emphasis in public messages within a year and is global, and in Russia. And at the beginning of 2020 the new CEO of IBM Arvind Krishna called these directions "two leading forces moving digital transformation today"[1].

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Besides, we in 2019 paid due attention to development of network of business partners and their examination, OEM clients and also the companies with which we sign agreements of Embedded Solution Agreements (ESA) and we will continue to give them necessary support, - Iris Dzeba says.
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As an example the CEO of IBM in Russia and the CIS countries provided the project of creation in Russia of the center of monitoring of cyberthreats (SOC) of Orange Business Services company and plans for cooperation increase with the Russian developer of storage systems Yadro.

It is remarkable that in 2019, for the first time since 2012, IBM VEA did not conclude any direct government contract with customers. According to base " circuit.focus ", in 2016, for example, it signed directly 19 such agreements, in the 2017th there were 16 government contracts, and in the 2018th – already only 2.

The similar trend is traced also in a case with the Russian office of the German developer SOFTWARE SAP. In 2015 she had 31 direct government contracts, and in the 2019th – only 2 and, as well as at IBM, and for the first half of the year of the 2020th – too so far any. The analyst "Renaissance Capital" Alexander Vengranovich in a conversation with TAdviser assumed that one of the reasons of reduction of direct contracts with state customers can be the fact that it became more difficult to "subsidiary" of foreign vendor to work at tenders against the background of import substitution policy in Russia therefore it places bigger emphasis on partners.

It is important to note that local legal persons of foreign vendors can sign not all the contracts with customers directly, as well as contracts with local partners: their some part can consist with foreign legal persons of vendor. But earlier players of the market with whom TAdviser communicated, noted: than for vendor the country has a bigger priority, that passes revenues from local business through its local office more.

Importance of the Russian market for themselves in IBM was earlier repeatedly emphasized. In 2019 the company and its partners in Russia held many events devoted to technologies of vendor, and spoke at a global conference of IBM passing in San Francisco in February the 2019th, including, and the Russian speakers from among customers and business partners.

History

2019

Opening of Competence Center in Moscow

The IBM corporation announced on October 10, 2019 TAdviser opening of Competence Center in Moscow — for the purpose of the solution of the growing number of tasks of optimization of air transportation in this region and the transport system in general.

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The aircraft on the world provides huge several advantages to passengers, suppliers and world economy in general, however it more than ever needs new methods of optimization of transactions, including drawing up and distributions of working shifts of pilots and stewards and land appointments — taking into account the most various regulatory requirements (RPP and FAR 117) and corporate the practician. The accumulated experience with the largest Russian airlines and a project success of research laboratory IBM Research in Haifa, carried out in cooperation with El Al airline, became premises for creation of Competence Center of IBM in Moscow — Ruslan Karpov, the head of Competence Center "Intellectual optimization methods" of IBM in the countries of Central and Eastern Europe reported.
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In Competence Center as a crucial element of the solution for optimization the IBM ECO platform which allows to solve optimization problems in the most different areas is used: transport logistics, drawing up the staff list, distribution of employees by working shifts, optimization of the baseline plan of deliveries of the enterprise, allowing to consider the strict and often changing market demands imposed to commercial enterprises.

Opportunities and services which the Competence Center of IBM ECO in Moscow offers airlines and other transport companies:

  • Optimization in the field of air transportation
    • Optimization of drawing up plans for pilots, stewards, land personnel and land appointments
    • Optimization of personal requests (PBS)
    • Optimization of boards

  • Optimization in the field of rail transportation

    • Optimization of empty structure
    • Optimization of an interservice interval
    • Planning and distribution of working shifts of drivers and conductors

  • Optimization of recording systems of clients

    • Optimization of online record taking into account historical data

  • Maintenance optimization

    • Optimization of warehouse stocks
    • Optimization of orders for service (taking into account the interrupted and uninterrupted tasks and dependences)

  • Optimization of planning of working shifts

    • Planning and distribution of personnel by working shifts

  • Optimization of mobile labor power and logistics

    • Expanded problems of routing of transport (RVR)
    • Optimization of changes at approach of unplanned events

Norilsk Nickel, IBM and MIPT will train blockchain specialists

The Moscow Institute of Physics and Technology (MIPT), Norilsk Nickel company and IBM Russia signed in June, 2019 the agreement on creation in Moscow (based on MIPT) Competence center for carrying out scientific research, training of specialists in the development area of digital technologies for the mining industry using open source software and specialized solutions.

2017

Plans for creation of the center of a research of digital transport with the Russian Railway and NCC

In October, 2017 Russian Railway, the New Economic School (NES), National Computer Corporation and IBM in Russia and the CIS signed the agreement on cooperation. It assumes creation based on NES of the Center of a research of digital transport for systematization of scientific research and front lines the practician in the field of digital economy. Read more here.

2017: Recession of revenue to 10.9 billion rub and profit up to 2.7 billion

Revenue of the Russian office IBM - EuropeAsia"IBM East/" - in 2017 was reduced by 8% - from 11.95 billion rubles to 10.92 billion rubles. It follows from accounting records of the company published in July, 2018. Net profit for the same period decreased almost by 23% - from 3.5 billion rubles to 2.7 billion rubles.

In 2017 the company significantly increased management expenses - by 40%, from 660 to 924 million rubles. Accounts payable "IBM Eastern Europe / Asia" on the end of the year were 1.39 billion rubles, debit – 2.71 billion rubles.

IBM reported on results of activity of office in Russia

In "Eastern Europe / Asia" results of financial activities of the company preferred not to comment on IBM.

In global reports of IBM quarter dynamics of its sales is mentioned in Russia in 2017 in dollars. So, according to the results of the second quarter the company announced reduction of revenue for 7.9% taking into account rate fluctuations of currencies. In the fourth quarter IBM reported on growth of revenue in Russia for 12% taking into account rate fluctuations of currencies.

From the contracts signed according to the results of biddings on the official portal of state procurements in 2017 for "IBM Eastern Europe / Asia" the largest became contracts with Rostelecom for technical support services of the equipment and the software of DPC for the amount of 293 million rubles and with Sberbank for development of design of interfaces and modification of mobile applications of 106 million rubles.

It should be noted that through the Russian office IBM directly there is only a part of contracts with the companies in Russia, the others - through her legal persons located abroad.

In 2017 based on investigation the western media mentioned IBM among the American companies which open source codes of the products for a research to Russian authorities for the sake of preserving of access to the Russian[2].

2016

Reduction of revenue to 11.9 billion rub (-12%), arrived - to 3.5 billion rub

Revenue of the Russian representative office of IBM (IBM VEA) in 2016 dropped by 12% - from 13.6 billion rubles to 11.95 billion rubles.

Net profit was reduced from 5.4 billion rubles to 3.5 billion rubles.

Reduction of revenue for 27% in dollars

In dollar expression revenue of IBM in Russia in 2016 financial year which came to the end for the company in December was reduced by 27.1%. It follows from the annual report of the company published in March, 2017. In absolute measures over the certain countries of IBM does not open turnovers.

According to the annual report of IBM, in the 4th quarter 2016 its revenue in Europe was reduced under the influence of the markets of Great Britain, Germany and Russia according to "macro - and geopolitical trends". In Central and Eastern Europe in the 4th quarter revenue dropped by 21%, and in Russia at the same time – for 38.8%.

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All of us read about different problems in such countries as Great Britain, Germany, Brazil and Russia, and our results reflect this reality in these markets, - Martin Schroeter, the senior vice president and the chief financial officer of IBM said in explanations to the report for the 4th quarter 2016. - Some of the countries – Great Britain, Germany and Brazil, for example, had significant effect on the general result. Others as Russia, Turkey and Egypt, also slowed down our growth, but had less impact, in view of the amount of these markets.
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Rates of falling of dollar revenue of IBM in Russia in 2016 were a little lower, than in the 2015th

In 2015 IBM also reported on reduction of dollar revenue in Russia. Then falling was 32.2%. At the same time in rubles at the Russian office – EuropeAsia"IBM East/" - turnover grew by 49.3%, almost up to 13.6 billion rubles, and profit - approximately for 77%, to 5.4 billion rubles (see below in the history for 2015). These indicators grew in rubles also in 2014.

Then respondents of TAdviser experts connected growth in rubles with exchange differences and change of the scheme of business of IBM therefore a part of operations and transactions which were performed through foreign legal persons earlier began to be carried out through the Russian legal person now.

IBM told TAdviser that business of their company in Russia includes interaction with a number of large customers who can conclude bargains for the considerable amounts. One of such transactions was made in the fourth quarter 2015, from here and a difference with revenue in the fourth quarter 2016, explained at the Russian office IBM.

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At the same time, in 2016 we observed increase in income in Russia on strategic directions of business of the company, namely, analysts, cloud computing and information security. Growth, however, was a little lower than expectations as customers experienced difficulties with preserving of IT budgets. And income from business consultation, in particular Interactive Experience, and infrastructure services exceeded our expectations, - told in IBM.
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Besides, in 2016 IBM brought to the Russian market the updated line of servers, DWH and other infrastructure. Additional revenue streams arrived from the growing segment of OEM clients, noted in the company.

The Russian office IBM added that will continue to cooperate closely with the ecosystem of distributors, business partners and developers to focus on the most advanced solutions which the company proposes to the customers.

The former director of one of the directions at the Russian office IBM considers that reduction of sales in dollars is connected with a number of factors. Among them – change of strategy of corporation. From sales of "iron" the corporation places emphasis on services, trying to sell them directly. The company very long depended on the sales channel, and now depends, noted the former employee of IBM in a conversation with TAdviser. But at the same time broke the relations with large integrators (before IBM stopped partnership about Croc, Lanit and NVision). Also the import substitution policy which is conducted in Russia affected, the interlocutor of TAdviser added.

Large partners of IBM, respondents of TAdviser, preferred not to report whether negative dynamics of sales in some directions of products of IBM took at them place. In I-Teco say that historically their company sells generally "iron" of IBM: brands Power Storage.

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A little demand for budget DWH of IBM grew, customers began to be interested more in software solutions as IBM develops in this direction and actively advances the software. But in general we cannot tell that indicators strongly changed, - note in I-Teco concerning dynamics of sales of products.
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Though in the new program of IBM indicators of sales according to software and iron conditionally integrated in one channel, at the moment there are enough sales of "iron" for last year I-Teco to save the partner status Gold, the representative of I-Teco in a conversation with TAdviser noted.

In one of large partners of IBM in Russia noted that the highest status in the affiliate program of IBM – Platinum. According to the company, necessary sales volume for its receiving – $10 million. Partners of the Platinum level in Russia, most likely, will not be absolutely, believe in the partner company.

In Technoserv note that the company traditionally works with all product lines of IBM. In 2016 from infrastructure storage systems of the class IBM System Storage, on the second place - the IBM Power Systems servers intended for work of crucial applications were the most demanded. Products in the field of information security, such as IBM QRadar, IBM Security Identity and Access Management and IBM Guardium are also demanded. Besides, the company actively develops partnership with IBM in the direction of the solutions IBM Analytics.

Olga Tyrnovskaya, the vice president for coordination of work with vendors of the Asteros group, in a conversation with TAdviser noted that their company cooperates with IBM more than ten years in the software direction and supplies of equipment.

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If on sales we also had a decrease, then extremely insignificant and it is connected generally with a turnover cycle of products of IBM, and not with updating of the affiliate program in any way. We have rather stable business with IBM and according to the results of work in 2016 we once again confirmed the status Gold Business Partner in the affiliate program of vendor, - Tyrnovskaya told.
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At the same time, political and economic factors continue to have significant effect on work of the Russian representative offices of the western companies, the representative of Asteros added. Considering general optimization of IT budgets, sanctions restrictions and "freezing" of projects, management Russian IBM keeps worthy sales level and actively supports domestic partners, she considers.

2015

Growth of revenue to 13.6 billion rub (+49%), arrived - to 5.4 billion rub (+77%)

According to Contour-Focus base, in 2015 revenue of the Russian office IBM - "IBM Eastern Europe / Asia" - in rubles grew by 49.3%, almost to 13.6 billion rubles. The profit of the company increased approximately by 77%, to 5.4 billion rubles.

From the contracts signed according to the results of biddings on the official portal of state procurements in 2015 for "IBM Eastern Europe / Asia" the largest became contracts about Gazprom inform for rendering maintenance services of software and to maintenance of the equipment. Their total amount was about 1.8 billion rubles. Among other large agreements according to the results of biddings - execution of works on software development for Sberbank for 278.7 million rubles and 153.8 million rubles.

The Russian office IBM significantly increased revenue and profit

Through the Russian office IBM directly there is only a part of contracts with the companies in Russia, the others - through her legal persons located abroad. The general result of sales in Russia expressed in dollars in 2015 showed negative dynamics - 32%. The CEO of IBM in Russia Andrey Filatov commented on TAdviser this result earlier (see below the subsection about revenue in dollars).

In "IBM Eastern Europe / Asia" preferred not to comment on ruble results of the Russian office. The company at the same time noted that business of IBM in Russia in 2016 goes according to its expectations.

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We, as before, help our customers to involve the most modern IT models intended for a cognitive era from the different industries told TAdviser in "IBM Eastern Europe / Asia". - At the same time we observe a certain revival from customers, in particular in such relevant and high-dynamic directions as analytics, security and various services.
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Sales in Russia sank for 32% in dollars

Revenue of IBM in Russia in 2015 was reduced by 32.2% in dollar expression, said in the annual report[3]. Falling was more essential, than in 2014: then revenue of the company was reduced by 22.7%. A bigger reduction of revenue, than in Russia, is given in the annual report of IBM only on the Chinese market – there it was 34.4%.

As basic reasons of reduction of turnover the CEO of IBM in Russia and the CIS Andrey Filatov in a conversation with TAdviser called devaluation of ruble which began at the end of 2014 and proceeded all 2015 and also fixation in rubles of IT budgets at customers: "Budgets of customers in rubles last year practically did not rise. There are rare exceptions, but they "are compensated" by other customers at whom IT budgets fell in rubles".

Filatov also noted that the level of falling of revenue of IBM appeared below, than the general decrease in volume of IT market in Russia. According to preliminary estimates IBM, in currency the market was cut approximately by half. Smaller rates of reduction of turnover of the company in comparison with rates of reduction of IT market mean that the share of IBM in the market increases, Andrey Filatov says.

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If from the financial point of view we did not reach desirable indicators, then in terms of market position 2015 was for IBM in Russia successful. I consider that we worked last year better than our main competitors, fixed the positions and increased the share in the market in all key directions, - he noted in a conversation with TAdviser.
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Did not adjust the strategy in Russia against the background of difficult economic conditions of IBM, Filatov told TAdviser. The company continues to implement the global strategy of IBM here – focus on cloud, analytical, mobile computing, social interaction and solutions for security. According to Andrey Filatov, in these directions revenue in Russia in dollars at IBM grew in relation to 2014. At the global level this direction at IBM in 2015 grew by 26%.

Opening of the client center in May, 2015 where it is possible to show to customers new solutions, technologies was for IBM help in business development in Russia, to do pilot projects, Andrey Filatov says. In the circumstances clients are limited in means and buy only what gives real fast effect therefore many want to start at first the pilot and to look at the solution. At the expense of the client center IBM in 2015 had more pilot projects with perspective of commercial result.

The same client center serves as the platform for training of partners. Presence of specialists in new solutions is a problem, Filatov notes: "When it is necessary to start new technology on the market, it turns out that there is a lot of partners, and specialists who would know new technology, no. Respectively, partners need to be trained quickly".

In 2015 on key for the IBM directions of business the number of partners in Russia increased approximately twice, Filatov tells. Now it makes several tens of the companies. Besides, IBM had a new type of partners: providers of cloud services and providers of services of a collocation and service of the IT equipment of the customer.

Opening of the Russia's first center for provision of services of IBM

The Russia's first center for provision of services of IBM opened in the Kazan IT park of Usada

In February, 2015 IBM announced opening of the Russia's first center for providing the services. The center opened, in particular, in the Kazan IT park of Usada, in the engineering center ICL. It will become a part of extensive network of the IBM centers which work more than in 20 countries of the world and more than 40 languages for customers from more than 60 countries provide financial services and also business process outsourcing with support.

First of all, the Russian center of services of IBM will be engaged in strategic outsourcing: he will render the services connected with administrative financial activities. The staff of IBM will coordinate such business processes of the customer as implementation of payments and purchase management according to the Purchase-to-Pay and Order-to-Cash systems and also registration and the reporting. For optimization of these transactions advanced technologies and tools of IBM on management of finance for the purpose of achievement of the greatest efficiency will be used.

The CEO of IBM in Russia and the CIS Kirill Kornilyev noted that the service centers IBM are an important element in providing to customers services in outsourcing financial and business processes worldwide.

"We made the decision to open the similar center in Kazan on the basis of favorable business climate and existence of considerable number of highly educated and experienced specialists", - Kornilyev explained the choice of the place for opening of the center in Russia.

According to representatives of IBM, at the time of official opening the center already employed graduates of financial higher education institutions and also the qualified IT specialists. In the next several years, on expectations of the company, the staff of the center will grow to 450 people.

IBM also noted that for maintenance of demand for a skilled labor force their company signed the agreement with Kazan Federal University on development of programs for improvement of the skills necessary for young specialists in the conditions of global economy in which all large role is played by the service industry. Within the agreement IBM and the university agreed to combine the efforts in the field of computer and computing sciences, analytics, industrial engineering, the sphere of financial services, strategy and corporate management.

At opening of the center of provision of services of IBM there was a president of the Republic of Tatarstan Rustam Minnikhanov. After survey of exposure at opening of the center, he charged to create the working group and to study a possibility of use of technology of outsourcing in the budget sphere.

IBM opened customer service center in Moscow

On May 20, 2015 the IBM corporation announced opening of the ultramodern client center in Moscow. Using analytics, cloud and mobile computing, instruments of social interaction specialists of IBM will help customers to solve different business challenges.

In the Russian representative office of IBM, in one of towers of the Moscow City business center the event of opening of the client center is held on May 20, 2015.

The center will provide to clients free access to opportunities of different technologies and the innovative developments of IBM. According to the company, the center will become the platform for meetings of customers and business partners with experts of IBM for knowledge sharing, experience and progressive ideas.

Kirill Kornilyev, the CEO of IBM in Russia and the CIS, told: "In the center each customer will be able not only to obtain valuable information for the solution of different business challenges, but also to glance in the future, is close to work with experts of IBM and to open for itself all tools of IBM which can help it to carry out successful transformation of business. A key task is active involvement and creation of stronger partnership with our customers. Within such model of cooperation, the center will prepare the whole set of specific measures with accurate business results, but not just separate presentations".

According to plans of the company, the client center IBM will become the platform for industry briefings, demonstrations of new solutions, the presentations, seminars.

In the center there is a demozona using a wide range of possibilities of digital technologies for demonstration of industry solutions for the public and banking sector, the sphere of insurance, tourism, transport, natural resources, power and municipal services, retail. The solutions available in the center cover the broad spectrum of questions meeting needs of each customer, in particular:

  • improvement of quality control of technology process,
  • situation management (for the operational centers),
  • improvement of a system of the organization of traffic,
  • increase in sales volume for specialists in the field of marketing,
  • more effective management of a brand
  • creation of programs of loyalty and customer retention,
  • the help to management consultants risks for counteraction to money muling and fight against fraud.

"For example, if the client during visit of the center wants to study the solution using which it is possible to manage all transactions of a water supply system, experts of IBM will show a prototype of such solution with a possibility of control of a condition of equipment and forecasting of basic reasons for emergency shutdowns at the expense of the analysis of different parameters. Besides, possibilities of creation of uniform command center for separate dispatching services in the territory of one enterprise and also the solution for the help to operators in resource optimization and management of local events in the conditions of open operating environment will be presented in the demoversion. Such solutions can be implemented as at the level of city, and regional water supply systems", – Maxim Serebryany, the head of the client center IBM noted.

As a part of the client center own data processing center equipped with the modern audio-and video system.

Break in relations with Lanit

In July, 2015 IBM unilaterally terminated partnership agreements with Lanit, having deprived of integrator of an opportunity to buy and supply the equipment and software. In more detail on to the link.

Break in relations with NVision Group

From the middle of July NVision Group stopped being the partner of IBM[4], having lost an opportunity to supply its equipment and software. In IBM concerning it said that their company "carries out the regular assessment of the channels of interaction with business partners".

Loss of NVision of the status of the partner of IBM coincided with change of the owner of integrator. On July 18 AFK "Sistema" signed the sales agreement of the subsidiary company MTS of 100% of NVision Group. MTS noted that understand "a political and economic context which accompanied this solution of IBM". According to the representative of MTS, this solution was expected and had no impact on formation of terms of transaction because NVision had an insignificant the business share connected with the equipment of IBM".

2014

Growth by 3 times arrived in rubles at the end of year

According to base "Contour-Focus", in 2014 profit "IBM East Europe/Asia" grew by 3 times - from 1 to 3 billion rubles. Revenue of the company for the same period increased by 24%, to 9.1 billion rubles. In dollar expression, according to the annual report IBM, revenue in Russia was reduced by 22.7%. The amount of local revenue in the report is not specified.

The company refused to comment on the financial results. Respondents of TAdviser experts refer to several factors which, according to them, could promote significant profit increase. So, two respondents - the top manager of the Russian representative office of one of the largest vendors of ADP equipment and the top manager close to one of distributors of IBM, - believe that the leading role in increase in profit was played by exchange differences.

The third interlocutor of TAdviser - the top manager of one of the largest Russian integrators - believes that the exchange difference in this case hardly played an essential role. Most likely, IBM changed the scheme of business therefore a part of operations and transactions which were performed through her foreign legal persons earlier began to be carried out through now "IBM Eastern Europe / Asia", he assumes.

In the last several years of IBM shows the strategy of transition to direct work with the biggest customers. Points deprivation of the partner statuses of several largest integrators to it by it and the conclusion of direct contracts with customers.

In 2014, in particular, IBM stopped partnership about Croc. The CEO Croc Boris Bobrovnikov then stated the version based on expert evaluation from the American partners[5]that all producers behave equally in emerging markets at that very moment when they are going to contact customers directly: they "shoot" some number of the largest integrators. In 2015 IBM also broke off partnership about Lanit and NVision Group.

In 2013 Sberbank and IBM signed the memorandum of the strategic cooperation directed to "optimization of supplies of equipment and software" in bank, and in 2014 Sberbank signed about the IBM contracts for the amount about 3 billion rubles.[6], revenues which provided to the Russian representative office of IBM a third. In 2015 signed direct contracts with IBM for the large amount also Gazprom inform.

The top manager from other large integrator believes that the strategy of transition to direct contracts with large customers hardly has an impact on indicators of profit of IBM. Besides, the interlocutor of TAdviser notes, it would be incorrect to judge all revenue of IBM in Russia on indicators of only one IBM Vostochnaya Evropaaziya LLC as the considerable part of contracts of IBM is signed through her legal persons located abroad.

Break in relations about Croc

At the beginning of 2014 IBM broke off the relations with one of the largest partners - Croc. The integrator had the status the Platinum business partner (IBM Cloud Specialty as an Infrastructure Provider). As a result of the cooperation termination Croc lost an opportunity to buy the new equipment from IBM, but saved access to a warehouse of spare parts for support of servers of already available clients.

Break in relations happened against the background of check of legality of import of servers of IBM in 2011 for needs of Sberbank. According to the results of investigation it became clear that Sberbank paid Croc for servers four times more selling price of IBM.

"We were surprised, having learned about the overestimated amounts which Croc received from Sberbank for these servers, and as result, IBM stopped the relationship with the company" — representatives of IBM said to the Forbes edition.

2012: Increase in number of offices

In June, 2012 it became known that IBM invests $6 million in increase in presence up to 22 offices in the region of Russia and CIS. Strengthening a customer support and partners, by the end of 2012, IBM will also double the number of employees in Russian regions. The business partner network of IBM in the region will be expanded to 4 thousand participants.

Kirill Kornilyev, the CEO of IBM in Russia and the CIS, said: "Business in regions shows steady growth, and the fact that this trend will remain in the future is obvious.

IBM will open offices in Voronezh, Ufa, Khabarovsk, Tyumen, Chelyabinsk, Nizhny Novgorod, Samara and Krasnodar, – the cities showing steady growth for the last several years.

Opening of new offices will provide to IBM presence in 7 federal districts of the country:

  • In Central Federal District IBM opens offices in Voronezh and Samara in addition to the headquarters in Moscow;
  • In the Southern Federal District IBM will open new office in Krasnodar in addition to existing in Rostov-on-Don;
  • In the Volga Federal District IBM will be provided in Nizhny Novgorod and Ufa in addition to the operating office in Kazan;
  • In the Ural Federal District IBM will open new offices in Tyumen and Chelyabinsk in addition to offices in Yekaterinburg and Perm;
  • In the Far Eastern Federal District IBM opens office in Khabarovsk;
  • In Siberian Federal District IBM is present at Novosibirsk and Krasnoyarsk;
  • In the Northwestern Federal District IBM already has office in St. Petersburg.

In addition to the existing offices in Kiev and Dnipropetrovsk IBM opens new offices in Kharkiv and Donetsk. Both cities are the significant industrial centers and have the high level of GDP growth. IBM already works with a number of customers in these cities in the bank, metallurgical, chemical industry and retail.

IBM also considers the possibility of expansion of presence in Kazakhstan and Uzbekistan where the company already has offices to Almaty and Tashkent.

The vice president for regional development of IBM in Russia Leonid Altukhov certified CNews[7]that the partner scheme of work will remain the main for vendor. Now, according to him, from nearly 4 thousand registered partners (registration via the website does not require real sales) about 1.5 thousand actively implement the equipment and software of the producer.

2011

The Prosecutor General's Office revealed plunders for 300 million rub

August 30, 2011. The Prosecutor General's Office announced identification of embezzlement of budget funds, selected for implementation of the federal target program "Electronic Russia (2002-2010)". Later, it became known that an incident is connected with supplies of equipment of IBM.

Materials of the inspection which is carried out by the State Office of Public Prosecutor were directed to Investigative department of the Ministry of Internal Affairs.

"The Ministry of Telecom and Mass Communications of the Russian Federation signed with JSC Rostelecom public contracts worth more than 2 billion rubles on execution of works within the FTP "Electronic Russia (2002 - 2010), says the State Office of Public Prosecutor. - During the inspection which is carried out by the Prosecutor General's Office in the Ministry of Telecom and Mass Communications of the Russian Federation and JSC Rostelecom the data testimonial of plunder of a part of these means by deception or confidence abuse were obtained".

So, by way of creation of schemes from numerous intermediary firms almost on 270 million rubles the cost of the program technical means purchased the Ministry of Telecom and Mass Communications through Rostelecom within the government contract was overstated, declare in the State Office of Public Prosecutor.

"Paid 653 million rubles for the purchased equipment of the Ministry of Telecom and Mass Communications at its actual cost of 383 million rubles", - investigators say.

Along with it it is established that one of prime vendors of the equipment made the doubtful transactions connected with money transfer in the amount of 150 million rubles into accounts of offshore company. At the same time the Prosecutor General's Office presence of a conflict of interest at the persons working in Rostelecom and in the commercial structure conducting equipment procurement within the FTP Electronic Russia is revealed.

With respect thereto the Prosecutor General's Office directed check materials to Investigative Department of the Ministry of Internal Affairs of the Russian Federation for the solution of a question of criminal proceedings on Part 4 of Article 159 of the Criminal Code of the Russian Federation (the fraud committed in especially large size).

  • August 31, 2011. The Deputy Minister of Telecom and Mass Communications Ilya Massukh commented on results of check of the Electronic Russia program execution by the State Office of Public Prosecutor. An inspection was carried out for the period 2009 - 10 in connection with the termination of validity period of the program, the deputy minister specified. But the statement of prosecutor's office is surprising in the Ministry of Telecom and Mass Communications as materials were provided for check to supervising department only five days ago.

About what supplier and what heads of Rostelecom there is a speech, the Ministry of Telecom and Mass Communications does not know as did not see check materials. In case of detection of violations the ministry is ready to cooperate with the State Office of Public Prosecutor, Massukh emphasized, having added that "we live in the constitutional state and only the court can make the decision on guilt".

Rostelecom also expressed disagreement with outputs of the State Office of Public Prosecutor. In the statement the company claims that all procurements are conducted during tenders, suppliers are the certified distributors of the largest world vendors, and the prices of government contracts are approved from the Ministry of Telecom and Mass Communications, the Ministry of Finance and the Ministry of Economics.

A supplier to whom the State Office of Public Prosecutor paid attention is NVision Group, CNews reported the source close to one of the checked organizations[8]. The contract about which there is a speech is purchases the equipment of IBM, he adds.

"Unclear, from where the State Office of Public Prosecutor took digit in 270 million rubles, - the interlocutor of CNews says. - Even the difference between the price of the government contract concluded the Ministry of Telecom and Mass Communications with Rostelecom, and cost of the equipment which was purchased for its implementation is less - 130 million rubles. It while this difference includes not only a margin of Rostelecom, but also cost of balancing and commissioning".

"Perhaps, the State Office of Public Prosecutor understands the price of component parts without delivery and assembly as the market value of the equipment", - continues a source of CNews.

As own version the interlocutor of CNews assumed that under offshore the State Office of Public Prosecutor could mean structures of foreign developers of the equipment: "Perhaps, it is the companies from Southeast Asia which are engaged in supplies of equipment?". NVision does not comment on a situation as did not see check materials.

Opening of virtual offices in regions

On August 1, 2011 it was announced opening of virtual offices in nine cities of Russia. Virtual offices will allow clients of IBM to obtain operational information about relevant regional events, offers and initiatives of the company and to select the closest business partner. Virtual offices are opened in Ufa, Chelyabinsk, Irkutsk, Nizhny Novgorod, Sochi, Krasnodar, Vladivostok, Omsk and Khabarovsk. Earlier they were available to clients of St. Petersburg and Perm.

Visitors of virtual office can contact directly regional representatives of IBM or to leave the request on the website in order that representatives of IBM contacted them. In development plans for virtual offices – implementation of functionality of connection of clients with technical support and also expansion of representation of a business partner network at virtual office. The virtual office represents the separate page on the website of IBM in Russia and the CIS containing contacts of regional representatives of IBM, business partners of IBM and also the offer, the directory of the performed projects and an event calendar of IBM which will pass in each city.

2006-2008: Corruption transactions in the Pension Fund of the Russian Federation

In 2006 IBM became the person involved in the scandal which affected the Russian market. According to law enforcement agencies, by deliveries of the equipment to Pension fund IBM participated in creation of a chain of false phony companies which allowed it to gain an additional income in the illegal way. According to law enforcement agencies, the competitions held at the choice of the IT supplier for RPF were dummy. The companies R-Style, LANIT and IBM initially were defined by winners. The cost of the equipment supplied by them exceeded market several times. The difference in the prices was divided among themselves by the agreed parties.

On December 6, 2006 the investigation team of the Ministry of Internal Affairs carried out a number of inspections in the Pension fund and also in the above-mentioned companies and at the place of residence of their management. Told the Ministry of Internal Affairs that investigates the fact of plunder of 1 billion rubles.

The companies LANIT and R-Style at which offices searches were carried out are at top of the list of the largest IT suppliers of the Pension fund Russia. In 2005 both companies delivered in RPF 423 IBM iSeries 400 servers for the total amount of 643.3 million rubles.

  • In January, 2008 in the Ministry of Internal Affairs said that the general damage caused to the state at supplies of equipment in the Pension Fund of the Russian Federation on this case is estimated at 200 million rubles.

  • In May, 2008. The Investigative Committee of the Ministry of Internal Affairs completed preliminary inquiry of sensational case of deliveries of the computer equipment to the Pension Fund of the Russian Federation. The only defendant recognizes the employee of fund who closed eyes to delay in supplies of equipment and did not take from the companies a penalty in the amount of 3.76 million rubles (in 2006 damages were assessed at 1 billion rub).

Later the Investigative Committee of the Ministry of Internal Affairs reported on results of preliminary inquiry during which it found out that in September, 2006 between the Pension fund and six companies public contracts on delivery of personal computers and computer systems to the amount more than 940 million rubles were signed, RIA Novosti reports. However contractors of public contracts (R-Style companies, Lanit and IBM) could not fulfill the obligation for delivery of goods in time that had to entail payment of a penalty for non-compliance with delivery dates of goods and works for the state needs.

According to Investigative Committee, the employee of fund Zoya Kiryukhina holding a post of the head of department of logistics of Head department of the subordinated organizations and logistics of the Pension fund had to organize acceptance and the subsequent sending on regional divisions of RPF of the purchased equipment.

However, using the office powers, from personal interest it accepted the specified equipment without careful recalculation on models and modifications, checks of its complete set and quality, having processed in one afternoon documents on goods acceptance of RPF and its transfer to storage to contractors of public contracts.

Personal interest of Kiryukhina, according to the investigation, was expressed, first, in reduction of volume of the work on collecting of members of the commission and the organization of their departure by warehouses, secondly, in simplification of an acceptance procedure of large volume of goods in the shortest possible time. Thus, the employee showed good results of the activity, consider in Investigative Committee.

The investigation found out that Kiryukhina knew about lack of a part of goods in warehouses and a delay of its deliveries for four days, but at the same time signed the consignment notes containing obviously false data on date of reception-transmission of goods. The actions it deprived of RPF of legitimate right for receiving a penalty for non-compliance with delivery dates of goods.

According to CNews, the project of delivery of the equipment to RPF really was followed by the mass of difficulties. For example, computers of IBM required fitting and installation of the software, the quantity of points of delivery exceeded several hundred, many of them were in places, extremely inconvenient for delivery, and some regional departments of RPF still just did not exist.

2006: Opening of research laboratory

In 2006 in Russia IBM opened research laboratory IBM RSTL (Russian Systems and Technology Laboratory) which, including, will begin to make use of experience of the Russian engineers for development of technologies of mainframes (high-performance computers). In the first three years the company was going to invest in it about $40 million and to increase the number of employees up to 200 people.

1999: Company registration

"IBM East Europe/Asia" was registered in Russia in 1999, in 2005 is registered in tax authorities.

1972: Yury Luzhkov signs the first contract with IBM in the territory of the USSR

In 1972 Yury Luzhkov signed the first contract for territories of the USSR with IBM. At that time future Mayor of Moscow was the head of department of informatization of Minkhimprom. The mainframe was purchased from IBM.

See Also

Notes


Stock price dynamics

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