The Russian telecom equipment got real chance

Why in the market of a little Russian telecom equipment?

As of fall of 2015 most the Russian vendors in the market of telecommunication equipment can be called Russian only conditionally. Most often it is OEM suppliers (collectors) of foreign solutions. But there is also a small amount of the Russian companies which are really trying to provide own software, and even hardware developments. At the same time the Russian hardware solutions in lack of domestic production of element base also, in fact, are "quasirussian".

From the normative and legal point of view development Russian is or is not – a question difficult. The Russian ministries and departments develop special techniques in which many factors – are considered up to a share of non-resident shareholders in authorized capital. From the point of view of experts, there is a certain way which the company should pass to receive not an OEM product, and not a prototype of the commercial solution, but really own market product at the exit. And the first stage of this way – the research developments making about 15% of the total costs of creation of a system.

Own developments in the field of programming - essentially important point for identification of software products as Russian. According to the results of this stage the prototype of future commercial solution is created. And further the main efforts (85%) leave for testing of a prototype, its completion and improvement, bringing to the level of a qualitative market product.

The companies which passed all way – from development of own algorithms before release on the market of a commercial product, for example, РДП.ру, T8 NTTs, Eltex are presented at the market.

The Russian vendor, presenting the solution to the potential customer, faces a set of problems, two of which have mental character - first, the companies should overcome strong prejudice concerning the Russian products as such, and secondly, - to struggle with the mistrust which arose at customers after the first wave of the pseudo-Russian telecommunication solutions of OEM-suppliers.

"OEM-suppliers discredited the idea of capability of the Russian specialists and the companies to make own intellectual product", - Nikolay Guzakov, the technical director of РДП.ру considers.

But except mental, the problem of distribution of the domestic equipment has also other aspects.

So, according to Dmitry Onishchenko, the director of the department of technical development of MTT, one of them consists in the following: not always there is a confidence that at solutions of the Russian vendor there is a necessary functionality which de facto is present at solutions of foreign producer in the considered segment. And the second moment mentioned by the representative of MTT – need of providing and building of qualitative level of technical support of the implemented equipment that brings to additional to costs in a production cycle of vendor.

The representative of MegaFon Yulia Dorokhina notes that due to the lack of the Russian component base the vast majority of domestic manufacturers buy materials and component parts abroad and for currency that directly influences their final ruble prices.

The Russian producer should work at already occupied and divided by the western vendors market, Kirill Shishkov, the representative of STC T8 company says. To an import substitution subject raising, according to him, often refused to the domestic companies at once, without discussions. Today a situation such is that potential customers still not especially wait for the Russian equipment and "it is good if at once do not refuse".

If case reaches discussion of the commercial offer, then, the representative of T8 notes, the domestic vendor rests against the financial opportunities, very limited as the Russian companies still have for themselves no support of financial partners - banks or other financial institutions, despite statements from high stands.

Foreign vendors, Shishkov notes, like that support is had. For example, the Chinese producers are supported by the Chinese State Bank. Reality of the Russian market of telecommunication equipment such is, the representative of T8 adds that now there is dumping from foreign producers.

Foreign vendors, according to him, are afraid to lose nodes in already built and new networks as if a part of nodes "is handed over" to the Russian producer, i.e. the probability of creeping is farther on network.

What factors do well to the Russian producers?

Emergence of the Russian network equipment became possible essentially from the moment of a new round of the concept of software-defined networks based on commodity of platforms. Thanks to it there was a paradigm shift of network equipment. This technology factor gave chance for development of the Russian IT industry, and in particular – for creation of domestic telecommunication equipment, Guzakov from РДП.ру considers.

Formation of SDN technologies affects import substitution "in a positive side", Onishchenko from MTT agrees. SDN allows to use the standard server hardware for a broad spectrum of tasks while all technology features for which own "iron" solutions were required earlier can be implemented only at the level of the software now, he explains.

The solution РДП.ру allows to optimize an address space of IPv4 c use of CG-NAT technology

According to Kirill Shishkov from T8, leadership in any developed market can give only one factor – new, disruptive technologies which can be applicable in the current reality and can be scaled. In T8, he notes, made the coherent DWDM systems at a dawn of formation of this technology that gave some advantage in time.

The current reality such is that additional benefits give to the Russian developers not only technology, but also political and economic factors.

"A foreign policy situation in total with rate fluctuation of ruble gave real chance to domestic manufacturers to occupy specific market segments of telecommunication equipment, - Guzakov says. - For example, in a present situation as a part of the Russian Federation there are territories which completely got under embargo – the Crimea, Sevastopol. The foreign equipment doubled in the price due to falling of an exchange rate of ruble that made us more competitive".

As ruble revenue of domestic telecom operators remained at the previous level, desire to reduce costs stimulates their interest in use of the equipment of domestic manufacturers, first of all in what the cost of software exceeds a half of the total price of the solution.

Due to decrease in a margin on software domestic vendors often have opportunities for providing more competitive price, than the western producers. For example, during recent competition of Rostelecom won by РДП.ру company double exceeding of normal number of so-called "rebiddings" was observed, and the total price of purchase fell by 3.9 times.

However, Dmitry Onishchenko specifies that action of economic factors is multidirectional. Sharp change in the exchange rate of currencies should promote improving competitiveness of the domestic equipment, but rise in price of cost of borrowed funds for the Russian companies works against them.

In what segments of the market of the telecom equipment domestic goods are already provided?

According to Dmitry Onishchenko from MTT, domestic analogs are provided in segments of the subscriber equipment, DWDM, Ethernet switches of data networks, VoIP-gateways.

There was a specialized equipment for a core of network of providers – the solution EcoNAT (performs the CG-NAT function) РДП.ру companies. The same developer creates the equipment in a segment of BRAS, DPI.

In Russia of "unit of strong producers of telecommunication equipment and software" they also work "in narrow niches", considers Yuli Dorokhin from MegaFon, noting at the same time that products of domestic manufacturers are already used in network of MegaFon. At the same time the problem of search in itself competitive Russian equipment suppliers and software arose long before crisis and is caused by high capital intensity of business of large telecom operators, she adds.

Nikolay Guzakov from РДП.ру says that his company already over a year conducts development of a line of routers for different segments of the market, including a corporate and public sector, with support of broad set of network protocols. "Internal demonstrations to which we invite representatives of future customers are already carried out. The release of the first samples is planned for January, 2016", - he tells.

Kirill Shishkov from T8, assessing a situation in general, notes what at the Russian producers "a lot of things is, but not all this is known for a number of reasons". The domestic equipment is inferior in some part to foreign samples, and, perhaps, it did not ripen even for mass use, but that this "maturing" happened, the representative of T8 is sure, in the highly competitive market intervention of the state and protection of own interests on behalf of the telecommunication industry is required.

The situation already cardinally changed to the best, Guzakov is sure: "There were departmental lists of the Russian software and hardware solutions from Minpromtorg. At the level of corporate standards of a motion are available too".

In particular, he gives an example of Rostelecom which develops the internal standard with criteria for assessment of the Russian origin of telecommunication equipment. It becomes according to changes in the federal legislation and orders of the Government of the Russian Federation.