The near future of IT market of Russia. Whether to wait for growth? Forecasts of top managers of the largest companies

The Russian economy has not the first year in a row hard times. The World Bank predicts low rates of its growth for 2019 - only 1.4%. On this background of waiting of the largest players on dynamics of IT market in Russia for the next two years look very optimistically.

Respondents of TAdviser representatives of a number of the large IT companies agree in opinion that it is possible to expect the moderate growth of IT market. At the same time the predicted dynamics in its separate segments significantly differs.

In 2019-2020 subjects of creation of digital economy in Russia and import substitution will continue to remain among key for the domestic IT industry. With respect thereto respondents of TAdviser experts did not avoid also issues of their influence on market development and also the changing role of state corporations and provision of foreign IT suppliers on this background.

Not iridescent, but bright future

The president of Lanit Group Philip Gens considers that there are no premises for strong organic growth, but inorganic growth nevertheless will be – first of all, thanks to programs of development of digital economy and large state projects. Therefore believe in the companies that in the market moderate growth is possible.

Philip Gens expects moderate growth in IT market (a photo - Lanit)

Sergey Chernovolenko, the global CEO of Softline, thinks that development of the Russian IT market will happen according to moderately positive scenario.

In 2019 we predict insignificant decrease in rates of its growth in comparison with last year's indicators. It is connected with the fact that in 2018 a large number of projects which were necessary for the organization and holding mega-events, for example, of the FIFA World Cup came to the end. Also implementation of "pent-up demand" contributed, - he explains.

Believe in Softline that in 2019 domestic IT market will grow by 10-15%. A new boost to development will be received by service and "cloud" projects, at the same time some companies will continue to develop actively and own IT infrastructure, Sergey Chernovolenko says. This trend is confirmed by indicators of Softline for last year. Note in the companies and a subject of cyber security: data protection is priority No. 1 for any company. According to Softline, growth of the market of cyber security will be slightly higher than growth of IT market in general.

The First Deputy CEO Croc Dmitry Vasilyev notes that the universal IT market will continue to grow: IDC predict that by 2021 its volume will exceed $5.6 trillion. The Russian market, according to Vasilyev, will also save positive dynamics.

Global digital transformation and transition to economy of platforms which cornerstone advanced technologies are will remain a main growth driver, according to us, - the representative says Croc. - The Russian companies go beyond the existing business models, the principles of their creation thanks to digital technologies are transformed.

Entry into the new markets and transition to new digital products will provide cloud computing blockchain neuronets Internet of Things robotics, VR/AR and other disruptive innovations, Dmitry Vasilyev considers. At the same time an impact on volumes of the Russian IT market will also be had by a prevalence of local solutions: from software development before production of the ICT equipment.

The CEO of Jet Infosystems company Vladimir Yeliseyev believes that in 2019 IT market will hardly show rapid growth or on the contrary, falling. According to him, all trends which were outlined last year will remain: from a public sector — a course towards digitalization of economy, from business companies — the projects directed to cost reduction, high-quality changes of business processes, complex IT outsourcing, etc.

The consumption pattern of IT as service will continue to become stronger: the companies aim to approach flexibly creation of IT infrastructure, putting opportunities to change of its configuration depending on growth of business needs. Banks and retail for which IT for a long time not just an automation synonym, and the instrument of increase in profit and entry into the new markets will remain drivers of development of IT market. Banks will be focused on expansion of communication channels with clients, start of digital financial services and products with biometric identification. Besides, one of the major tasks will remain increase in security and fight against cybercrimes, - Yeliseyev says.

Accents of costs for IT in retail will be slightly others: the companies are anxious with transition to online cash desks and obligatory marking of some groups of goods. From disruptive technologies retail networks will give preference to the solutions increasing energy efficiency based on IoT, the CEO considers Jet Infosystems.

Informzashita sees that IT market continues to show systematic growth. At the same time focus of growth is actively displaced towards IT services, Leonid Ukhlinov, the vice president, the chief executive of the company says. According to him, there are several factors which will become defining at development of the industry these years. First, a lack of qualified personnel in IT market that will lead to growth of services in the field of IT and cybersecurity in particular.

Staff shortage will demand the solution of an issue of automation of routine transactions and many organizations will prefer to do it through the outsourcing companies with examination necessary to them, - he says.

Secondly, a considerable role will be played also by the accepted course towards import substitution: if the state supports further this rate, then integration tasks of transition to domestic solutions will be enough for all, Leonid Ukhlinov considers.

Stepan Tomlyanovich, the CEO of FORS Group (FORS Group) company voiced opinion that the domestic market of information technologies will continue moderate growth. IT market in 2019-2020 will continue to grow quicker, than GDP. At the most conservative forecast, annual growth rates will be not less than 10%, expect in the company.

Among main growth drivers - programs of the government for creation of digital economy and rapid development of the sector of IT services, first of all, the cloud direction, - Stepan Tomlyanovich says. - We see stable demand for software and hardware tools, infrastructure solutions, services in technical support, maintenance and consulting. The course towards import substitution and, as a result – transition from the proprietary software to platforms with the open code to order had the noticeable stimulating impact on the sector of software development.

Maxim Tikurkin, the CEO of System Software company, notes that according to IDC Russia IT Services Market, in 2017 the volume of IT market of Russia was $21.8 billion, and in the 2018th — $22.6 billion. The company assumes that this growth will continue. But the specifics as all pent-up demand which existed in respect of acquisition of the equipment was already implemented will change. Now the technologies allowing to work with the resources which are available for the companies and to optimize them will begin to come out on top, Tikurkin considers. For example, in virtualization, server technologies.

The increasing business need for digital transformation and the state investments into support and development of digital economy will become important facts of growth of the market, - the CEO "System software" notes.

He added that it is possible to expect growth of the Russian market of cloud computing, approximately at the level of 22-25% in ruble expression. On expectations of the company, its total amount (including SaaS, IaaS and PaaS) will be about 52-53 billion rubles. Will continue to gain steam and a trend on import substitution, it will be promoted by the national program of digital economy of Russia and the project for development of the IT industry for 2019-2025, Maxim Tikurkin believes.

Solutions for state structures, a MIC, strategically significant enterprises, first of all, regarding transition to domestic hardware component parts will be substituted most actively.

Forecasts for segments

Sergey Chernovolenko, the global CEO Softline, notes that, speaking about software, it is necessary to separate the market as solutions. In a segment of "heavy" solutions of type ERP also CRM you should not expect significant growth, he considers. And development and sale of software on the basis of artificial intelligence, solutions in the field of speech sensing technologies in the long term will grow two next years above the market in general – 20% and more.

Sergey Chernovolenko expects high growth in a number of software segments (a photo - chief-time.ru)

As for the hardware, here Chernovolenko stopped on one aspect. According to him, it will be unambiguous growth in a data storage segment – for 15-18%, and with increase in number of projects on IoT implementation – it is even more. All other segments will show moderate growth in 5-10%.

Growth of number of the targeted attacks, acceptance of a number of laws (for example, on protection of critical information infrastructure), implementation of IoT-solutions, increase in the qualifications level of hackers will entail growth of the market of cyber security in 2019 for 15% and more. The trend will be steady in the long term 3-5 years, the global CEO of Softline believes.

Vladimir Lviv, the board member, the director of strategic development of I-Teco believes that the segment of software will not show significant growth in 2019.

The main driver of development of the software now - import substitution and to develop, test and approve software, to create the industry of "product" software, is necessary time. With respect thereto the segment will grow no more than by 10-15% in 2019, - he predicts.

At the same time in the 2020th and especially in 2021 when real readiness of competitive domestic goods is expected, in I-Teco assume not less than 30% growth in this segment.

In a segment of information security it is possible to predict approximately 30% growth, in particular, due to state regulation in the different industries, for example, in a telecom, Lviv added Vladimir.

According to Leonid Ukhlinov from Informzashita, in the cybersecurity market, in particular, positive dynamics will remain: in the last five years there is its steady financial growth. The company selects three key drivers of growth. The first and the main – ensuring protection of objects of the critical information infrastructure (CII). Noticeable growth of the amounts of financing, directed by state corporations and the organizations with state participation to implementation of requirements of the bylaws issued by regulators for performance of the federal law "About Security of KII" is expected.

In 2018, for example, in Informzashita saw a gain of volumes of such financing in the amount of 20% in comparison with 2017.

Leonid Ukhlinov sees several drivers of significant growth of the cybersecurity market (a photo - strategyjournal.ru)

The second driver – ensuring protection of the state IT systems. Increase in the amounts of financing in this segment of the cybersecurity market is lower, than in the first case, and will be provided, mainly, due to growth of expenses of regional budgets, Leonid Ukhlinov says.

Considering results of 2015-2018, it is possible to expect that the amounts of financing from the federal budget on these purposes of significant changes will not undergo. During 2016-2018 decrease in an annual gain of the amounts of financing from 37 to 15% is mentioned, - he added.

The third driver – personal data protection. Generally in this sphere the cybersecurity market will receive finance from the medical and educational organizations and also the organizations of social service.

Decrease in marginality of business as trend

Decrease in level of marginality - a trend of the world IT industry, Sergey Chernovolenko considers. Management of marginality is the cornerstone of profitability of any company working in the field of IT. It is connected with increase in the competition and transition to new business models, he explains.

Under the influence of a number of factors in Russia there is a decrease in marginality of business too. The first reason is connected with competitive environment because there are more and more IT solutions and services turns into category commodity (widespread consumer goods or goods - a comment of TAdviser), - Chernovolenko says. - Secondly, all world vendors start new business projects with use of cloud computing on a basis an underbrush, the managed services which have an impact on profitability. Vendors look for an opportunity to lower costs through sales channels that affects activity of distributors and system integrators in Russia.

It is necessary to manage marginality, the global CEO of Softline notes. First of all, the companies should transform the business model which should be at the level of acceptable profitability at low marginality. About his points of view, not all companies will cope with such difficult task. Its solution assumes creation of the business model based on scaling, elasticity, strict control of pricing and expenditure management.

At last, to manage marginality, it is necessary to develop examinations for which customers will be ready to pay an award, Sergey Chernovolenko added.

Role of state corporations

Earlier integrators could not even imagine that on their house IT market players from other industries – banks, the industry, a telecom will come, Sergey Chernovolenko from Softline notes.

On the one hand, state corporations will promote the market growth because will begin to buy more. With another, will create the competition to traditional IT players, - Chernovolenko says.

He added that Softline on this background feels confident and is ready to work on difficult projects, including, in partnership with the state corporations.

Informzashita notes that the large companies with state participation actively joined in creation and development of the cybersecurity directions or the separate cybersecurity companies.

Whether such approach will allow them to create the IB-professional centers of competences – will show time. Meanwhile this approach strongly influenced the personnel market – specialists constantly receive offers on transition to the companies, newly created at state corporations, at the same time the offered salaries are artificially excited to the amounts which are strongly exceeding average market, - Leonid Ukhlinov says.

I-Teco sees that state corporations densely were engaged in IT-Business both as customers, and as contractors. They create the internal IT companies in which specialists and technologies concentrate, and the role of state corporations amplifies also that their internal IT companies have no problems with sales markets of products, solutions and own services, Lviv notes Vladimir.

Though they have many calls - in particular, a question of quality and speed of reaction to market changes for state corporations, in my opinion, extremely sharp, - the board member of I-Teco notes.

Programs for digitalization of the different industries start. State corporations transform IT market, increasing the need for product and niche business companies and competing with classical system integrators, Lviv says Vladimir. So there is a consolidation of the market under the auspices of state corporations which changes the IT industry in general.

As the situation with foreign vendors will change

The international vendors are focused, first of all, on business results. If achievements of the company satisfy the management, then it continues work in Russia, Sergey Chernovolenko argues.

I do not think that in the next several years any of the foreign vendors presented at the domestic market will make the decision to contract the activity in our country for political motives, - he says.

Leonid Ukhlinov from Informzashita notes that the state conducts active import substitution policy. Lately a number of the limiting legal acts is accepted. Let's quite allow leaving of a number of foreign vendors from the Russian market as, for example, it was already made by Splunk, he says.

The Russian developers need to repeat at least in a short time a foreign analog as at most – to exceed it. But you should not forget that abroad many years and thousands of working hours were already spent for creation of software. Large-scale investments are necessary: or through selection of budgets to consumers, or through direct financing of producers, - Ukhlinov notes.

Nevertheless, it should be noted that successful domestic projects are also them much, the top manager of Informzashita added. There were good developments of the Russian companies in the field of the calculated equipment, in the field of VDI and mobile devices.

I-Teco does not expect the special changes connected with foreign vendors. Here the market configuration which is already created by sanctions in general will remain. In spite of the fact that some interests of vendors suffered, each company built own logic of work in the Russian IT market, including using OEM production, explains Vladimir Lviv.

It should be noted that the most considerable losses in our market were suffered also producers of software as the domestic companies have the strongest competences and perspectives of development of software segment will continue to bear, - he summarized.

TAdviser100 ranking: The largest IT companies in Russia

In May, 2019 TAdviser prepared a new ranking of 100 largest companies working at the Russian IT market. It shows that, despite the remaining difficult economic situation in 2018, revenue of the vast majority of the largest companies increased - revenue growth is recorded at 87 companies from 100.

At the end of 2018 total revenue of 100 largest IT companies in Russia which entered TAdviser100 ranking made 1.477 trillion rub that for 122 billion rubles above an indicator of the previous ranking.

The largest growth of revenue among all participants of rating was shown by Talmer company (+649%). Five more participants of a ranking increased revenue more than twice – Satel IT, Haytek, UTsSB, Gazprom avtomatizatsiya and BIA-Technologies.

The greatest reduction of revenue was observed at Atholl companies (-33.6%), RTI (-25.7%), ID-Management Technologies (-25.4%), Telecommunications (-25.3%), Compulink (-18.3%), Satel (-14.2%).

Positive revenue development in 2018 gives the soil for waiting of positive results in general and in 2019, considering that the general economic background remains by and large same. Representatives of the largest IT companies also see enough factors which can promote growth in 2019-2020.

See Also

IT market of Russia