TAdviser interview: Head of the Ministry of Digital Science Maksut Shadayev - on new mechanisms of import substitution and the main trends in the IT industry

Maksut Shadayev: Everything happens quickly enough, conditions and rules change on the move. In fact, everyone got into a "perfect storm" situation. I will highlight a number of main trends that, in my opinion, determine the development of the situation in the industry.

Firstly, large corporate customers who have always relied on the development of foreign solutions - this has always been part of their policy of ensuring competitiveness - turned their face to the domestic market: they hold many meetings with Russian developers, actively study Russian products. I know that many integrators are busy developing a strategy for switching to Russian solutions. It so happened that our long-standing desire to stimulate the refusal to use foreign solutions in favor of Russian ones with the help of various financial incentives, policy decisions to limit the use of de facto was implemented - customers turned their face to Russian manufacturers of IT products.

Just the other day, we held a meeting with large IT customers, and observed their keen interest in detailed information about Russian IT solutions. Large corporate customers feel an acute shortage of IT solutions, and this generates a high demand for Russian developments. And this, I think, is the most important trend that determines the current and tomorrow appearance of the IT market of the Russian Federation.

The second trend is also to a certain extent associated with the cessation of work of foreign equipment suppliers. We have a large number of applications for the development of equipment production: server, telecom equipment, etc. From my point of view, the market will change towards the supply of components. Obviously, it will be more difficult to import finished products, logistics will become difficult, which means that the cost of products will be higher. This means that assembly with an increase in the level of localization will be carried out on our territory. And I see confirmation of this trend: a fairly large queue of companies has already lined up that are ready to invest in assembly production. They have a clear idea of ​ ​ the logistics of supplies, the so-called BOM (Bill Of Materials, components by placer), they are ready to purchase machines, they only ask to support this direction of activity from the state.

And this is the second key prognostic thesis: components, albeit in complex logistics schemes, but go to us. Accordingly, the assembly and production center of the final equipment will move inside the country. Naturally, all component manufacturers look at Asia as a supply channel. And we will not get away from this until the programs for the development of our own production of microelectronics and radio electronics start working. As for the finished equipment, in general, it seems to me that there will be difficulties with it for now. I believe that the most likely is the delivery of components and assembly on the territory of the Russian Federation.

And the third important trend is the high demand for cloud services. While there is no ready-made equipment, and logistics is being rebuilt, the issue of equipment efficiency turns out to be a very relevant topic. Therefore, many customers seriously think about clouds. This is noticeable even by departments: many of them, who had not previously considered the possibility of using the state cloud at all, today caught fire with such a desire, since in fact this is a question of the efficiency of using the infrastructure.

Carriers negotiate intra-network roaming so that resources of already installed base stations can be shared.

In other words, our industry is finding answers to current challenges. Yes, it's not easy. Yes, it will take a certain amount of time. And here I fully agree with the Chairman of the Government of the Russian Federation and the head of the Bank of Russia. But the fact that these processes are underway and the answers to the most pressing questions are found is a positive fact.

Maksut Shadayev: Large corporate customers feel an acute shortage of IT solutions, and this generates a high demand for Russian developments

Maksut Shadayev: This is a very serious challenge that we must answer. Today we - I mean the government of the Russian Federation - at the direction of the president of the country, we are completing the formation of a new institutional environment:, tax privileges a delay from the army, preferential mortgage for IT specialists etc. Exemption from checks is also a very important measure. These measures allow us to create the right environment. However, without involvement in the necessary processes of our business, it is impossible to create real demand and use the liberating personnel resources. This implies not only state-owned companies, but also large private companies. The main challenge for us at the moment is to make business actively participate in the development of Russian solutions.

Maksut Shadayev: This can be done only through the inclusion of them in decision-making processes - through collaboration, certain platforms for joint work. Our position is as follows: the Ministry of Digital Industry has quite extensive financial support mechanisms. So, we allocate grants, including to very small companies: for the development of a prototype (MVP), for bringing solutions to market, for pilot implementation, and even for export. We intend to actively support exports to the countries of Southeast Asia and the Middle East. At the same time, the main problem that we feel very strongly is that customers should be built into all these measures of state support. Without the participation of business, we will not solve this issue. State-owned companies always work in a directive manner, so they performed their mission earlier and will continue to fulfill. But it is obvious that state-owned companies alone will not be able to rebuild the entire process. We need large metallurgists, machine builders, retail, banks - the whole layer of business that creates the demand for digital transformation. These companies should be at the head of decision making and help decide which decisions and how to develop, what financial support measures and who should be provided.

Maksut Shadayev: Of course! This is a fairly simple scheme. We are saying that business must identify its needs and we must together form a funnel of proposals. Further, the business can conclude a long-term contract for the production of a particular solution, or for the implementation of this solution. And then - different options for action. So, we can co-finance the development and implementation of this solution, both for business and for legally significant contracts to issue large grants - up to 6 billion rubles. for co-financing developments. But I emphasize again: without business, this process does not make sense.

Maksut Shadayev: We have identified 10 industries for ourselves - leaders in digital transformation:

• finance;
• retail;
• construction;
• HOUSING AND COMMUNAL SERVICES;
• Industry;
• communication and media;
• power;
• agriculture;
• transport;
• social sphere.

And there are already companies that have decided to become participants in consortia.

Maksut Shadayev: Yes, there is a shortage, many customers feel it. Traditional vendors were guaranteed to ship the necessary "iron" within two to three months, and now, due to the fact that they stopped their work, there could not help but be a shortage. But I see that Russian manufacturers are solving this problem: the components are going to the country, and the servers are being assembled. I see how this process happens, almost online and I can say that the situation here does not cause serious concerns - Russian manufacturers will issue products. It is clear that there will be some restructuring that will possibly lead to a temporary drawdown in supplies. But the components are coming.

Maksut Shadayev: Firstly, I believe that the experience they have accumulated is the best international practice. Secondly, the infrastructure built on this equipment remains and still requires maintenance. Obviously, within three to five years it will function. Therefore, engineers who have support experience will definitely be in demand. And it will definitely be easier for them to retrain to work on Russian equipment. Therefore, I do not see problems with the employment of highly qualified engineers. On the contrary, I see that today they are caught up in large companies that need to guarantee the stability of their infrastructure. Obviously, with their experience and professional skills, they will definitely be able to support the further development of infrastructure based on domestic solutions. Now it is they who are worth their weight in gold - engineers who know how to work with foreign equipment.

Maksut Shadayev: I repeat that ready-made jobs are the best international expertise. And this is a good civilized way to break the connection of Russian offices with the parent company and continue to operate on the territory of the Russian Federation. We strongly welcome this process and ask large vendors who leave, this is exactly what to leave such independent Russian companies. Honestly, we even stimulate this process a little... We are negotiating with large companies, we offer them this option. In general, what we see in the consulting market is a very correct direction in the formation of such models of work in our market. I hope that large vendors will adopt such models of activity.

Maksut Shadayev: I met with the leadership of several such R&D centers (I will not give specific names, because these were non-public conversations). And I was surprised by their desire to stay to work in Russia. All of them say about the same thing: yes, some part of the people are leaving, but this part is very small, and if there are ambitious projects in Russia, then they are very interested in staying in Russia. And many colleagues who work in Russia have ambitions to make a new powerful turnkey product - there is such a challenge. For me, it was, I must say, an amazing discovery.

In addition, you need to understand that a real hunt has unfolded for the employees of the outgoing R&D centers. I think that this is exactly the asset that many large players are fighting for: our producers, our large owners of ecosystems, because everyone understands the high value of this asset. This struggle is still in our favor, as far as I know. That is, many highly qualified developers prefer to stay in Russia to try to work in a new paradigm. And everyone feels the drive from the upcoming big ambitious tasks here in the conditions of the new niches that have opened.

Maksut Shadayev: I think that many large companies have frozen hiring to see how the situation will develop. Now, as I see, many employers are restoring the set of personnel. I think that within two to three months the situation will normalize. After all, the need to develop a large number of new solutions, the implementation of ambitious projects - all this will require personnel. And taking into account the fact that some of the personnel were released abroad, there will be great competition for the rest.

It is clear that in this situation a small business is sinking somewhat - the one that was associated, first of all, with integration work or was tied to the supply and maintenance of foreign equipment. Small businesses are obviously under the biggest pressure here. But I really hope that the incentives that we create to reduce the burden on business, if possible, receive financial support from the state, will dampen these negative moments.

Maksut Shadayev: Indeed, the new rules that were outlined in the international arena put foreign colleagues before the need to find ways to reduce dependence on American and European solutions. Yes, I see a serious interest in reducing such technological dependence. I see three main regions: Southeast Asia, the Middle East and Latin America. Many Russian companies, indeed, receive requests, hold meetings, presentations. This is good, because the Russian market itself, in general, is not very large. And in order to create really competitive solutions, they must exist on an international scale.

It is expected that in the III-IV quarter of 2022, an IT export support program will be launched. While we are making, rather, very careful steps. In particular, through our trade missions and diplomatic missions, we are trying to understand and formalize any systemic support measures. And, basically, so far this refers to the development of B2B schemes. It is important not to slow all this down.

Maksut Shadayev: We believe that any problems, any cataclysms in the market give us the opportunity to develop our digital services. For example, today we are trying to pass through legislators a bill that involves the complete rejection of paper notifications, for example, receipts for utilities. We believe that in conditions of a temporary shortage, it is possible to switch to electronic mailing, and this will be useful for business, because it will reduce the cost of such events.

Therefore, for us now it is fundamentally important to switch to electronic document management: states with business and business within themselves. At present, it is the question of finding ways to reduce all kinds of business costs that will be the main one.

And in this part we have a ready-made infrastructure. So, we already have an electronic signature. In June, we launch the process of issuing contracts for the sale and purchase of cars in electronic form. We launch a service that allows any person to send a document through the portal to any other user, as well as to ourselves, in order to sign it with an electronic signature. All this will be implemented simply and for free.

In other words, our accents today have shifted, from the point of view of digital services, from socially oriented public services to such services that are designed to reduce costs for business. And that's the key story.

The second important topic for us is how to stimulate demand for commercial solutions. I believe that we very correctly once chose a course to support educational online platforms. The point is that the government allocates certain budgets to schools and teachers, within which they themselves can purchase electronic educational services or content from existing commercial platforms. This is a very correct practice, because in this way we stimulate the demand for Russian solutions, and are not trying to create competing state platforms.

The topic of digital ID is relevant. Its further introduction into all commercial ecosystems makes it possible to use all our services, identification mechanisms, and fight fraud.

And, of course, stimulating demand for Russian competitive solutions is one of our priority tasks. So, at the end of summer, we must completely restart the register of Russian software. There is a fairly large number of products, but it is not very convenient to use this registry. Now we are turning it into a classic showcase, a marketplace so that customers - corporate and end users - can choose the product that meets their needs. There are many interesting solutions in the registry. But until now, customers had to look for everything on their own. We are sure that we need to simplify access to these services.

Maksut Shadayev: The register in its current form is just a large table in which there are more than 10 thousand positions. It is difficult to find quickly and simply what the customer needs. And the new marketplace will be similar to those marketplaces found in Amazon, Azure. That is, a fundamentally different way of working with registry information will be implemented. For example, you will be able to specify a foreign solution that you want to replace, and alternatives will be offered to you. In fact, this is the service for which integrators today receive a lot of money.

Maksut Shadayev: Gostech is among those platforms on which there is now a rush of demand. We see that - again in a shortage - along with the infrastructure, customers want to receive ready-made PaaS services that cover all their priority needs. By the end of 2022, we have planned the completion of all pilots. Now we are working with other regulators to ensure that Gostech services can be used in multi-tenant mode, that is, not to create separate clouds for each specific GIS, but to ensure that they share a single platform with different state systems. Now the final stage of work with regulators in the field of information security is underway . As soon as we complete it, and I believe that the light is already visible at the end of the tunnel, we can expect that by the end of the year Gostech will reach industrial capacity.

Maksut Shadayev: I believe that due to the fact that IT specialists as a whole are more integrated into all kinds of international chains, international projects, then, of course, the degree of their anxiety is on average higher than that of representatives of other sectors of the economy. Plus, you need to understand that they are super-liquid in the market. I think that our IT specialists have some of the highest liquidity ratios in the world. That is, they are more likely to find high-paying jobs in other countries. And many of them worry that Russia will no longer have interesting work, because, say, Nvidia will not supply us with its supernova developments, and there will be no way to use them in its pilot projects, for example, in the field of artificial intelligence. Many people look to the West based on these expectations - how not to stop developing in the face of a possible shortage of technology.

Second consideration. Many IT professionals were initially located to work abroad, many studied these prospects. However, I see now that those interesting opportunities and the interesting work that exists within the country, many encourage to stay here and get involved in work with ambitious projects in Russia.

I can hardly say anything definite about the level of patriotism. Rather, I can share my thoughts on the mood in the IT environment. I think that all IT specialists are patriots of Russia, everyone is very worried about the country. In general, here the level of patriotism is even higher, because IT specialists experience a certain responsibility, maybe even increased responsibility for the country, because they are on the front line of economic development. It is on them that the future of the country largely depends.

Maksut Shadayev: See. These will not be contests. The following technology will work. Industry companies will shape the need. After that, we will publish this need. Then we will collect proposals, a variety of things: from ideas to specific implementations, mature solutions. And then pitching will take place: within one day, companies - customers and companies - developers will jointly consider each of the proposals received. And industry customers will decide in what form we should support this or that initiative, this or that project. All this will happen in public.

We can say that there will be "industry days." And by the end of October, we must pass the entire described decision-making chain through 10 industries. And then pass it every six months, because it is not a one-time, but a regular event.

The task of the Ministry of Digital Science in this regard is to figuratively put at one table on the one hand - all large customers, and on the other hand - all IT companies that have something to offer these customers. And then this process should be moderated so that not a single sound proposal remains pending, and we would definitely determine the form of support that the Ministry of Digital Industry will provide, according to the decision of industry customers. In fact, this means direct access to the customer with our organizational support. So, on June 3, we are launching a site for support measures. And then there will be published work schedules by industry.

Maksut Shadayev: Now there is a discussion at the intergovernmental level. Yes, very careful, very careful. I see that companies independently find options for resolving their issues. It is possible that here any political and intergovernmental agreements, on the contrary, will interfere with this process. But in any case, I will once again note: firstly, we are open to discussing different ideas, and secondly, today we are supporting cross-border business. In what directions?

The first is concessional import lending. At the end of May, the government approved the rules for granting soft loans for purchases abroad. And this, indeed, will be a fairly serious support measure: good lending conditions are provided for the purchase of components. In general, this is an intersectoral program, but all our directions there are fully reflected. The issue of customs, certification, the lack of confirmation of the copyright holder - all initiatives are being implemented, all problems are clear, and all the necessary support will be provided at the logistics stage and the delivery of these components to the country.

Maksut Shadayev: Do you ask if we plan to prohibit anything in terms of import into the country? No, the Ministry of Digital Science does not plan such bans. On the contrary, we believe that in conditions of increasing the cost of logistics for everything that belongs to the class of "heavy" equipment: servers, DSS, telecom switches, base stations - we will try to reduce the cost of components.

As for the finished equipment, the duties for most of the positions today are almost zero, and the Ministry of Digital Engineering definitely does not plan to increase them. We believe that in the current conditions it is still unreasonable to introduce additional customs duties. We should think about prices for the final customer, and not consider duties as another reason to earn money.

Maksut Shadayev: Firstly, I believe that the decree you said about is the Decree of the President of the Russian Federation of 01.05.2022 No. 250 "On Additional Measures to Ensure Information Security of the Russian Federation" (its initiator, by the way, was our ministry), it carries, let's say, a turning point. It introduces personal responsibility of the heads of system-forming companies, owners of CII facilities. And most importantly, we stimulate the involvement of independent companies in conducting PEN tests, expand the Bug Bounty mechanism ("reward for error") - this is all about practical security, not paper. They are ready to discuss the idea of ​ ​ universities. We ourselves do not have enough resources to collect the necessary information, and so far no such initiatives have been received from the universities themselves. But we have an existing mechanism - the headquarters for cybersecurity, which includes all the largest Russian information security companies.

Let me declare this topic at the next meeting of the headquarters on cybersecurity, we will invite you to this meeting and look at the reaction of colleagues. If the industry is ready to organize itself, then we, of course, are ready to help this.

Maksut Shadayev: We, as it seems to me, have no other option. All federal systems should be based on the best regional practices. There is a question of centralizing these systems. There is a question of the desire of the subjects. While in our country, many regions talk about their unwillingness to use the cloud service, about the desire to implement the implementation of on premium in order to deploy and operate all solutions on their site. But taking into account the shortage of equipment, I expect that there will be a transition towards cloud centralized platforms, including on the basis of Gostekha.

Maksut Shadayev: Let's clarify the situation. Accreditation makes it possible only to exempt employees from the army. Neither tax breaks nor any additional support measures are relevant to this. If the company is accredited, it can only get a reprieve for its specialists from the army right now.

Another significant point: initially this service is automatically provided. Accreditation is one of the few services that is provided completely in automatic mode. There is no decision-making process at all. That is, when submitting an application, the system checks whether there is one of our OKVED codes, and the company is automatically accredited. Today we see that this mechanism provides a fairly wide scope for using these capabilities for various purposes. On the one hand, this is perhaps not bad - the fact that any company can add the necessary OKVED code and free its IT specialists from the army.

On the other hand, we fear discrediting the mechanism itself. Actually, that's why we started a discussion on this topic. Most likely, from the point of view of accreditation, two parameters will be introduced: the share of IT employees in the headcount and the share of IT costs. That is, in order for us to recognize a bank or university as an IT company, they think they must meet one of these criteria. I believe that during the summer months we will develop these requirements and a mechanism for putting them into practice. There is no ready-made solution. Most likely, we will begin the discussion and come to a structure agreed with the market by mid-summer.

But I repeat again: this affects only one measure of support - a delay from the army. Recently, we analyzed the information that was sent to the Ministry of Defense - this was our first experience in this part: 8700 people applied accordingly. I think this is not such a large volume that creates additional risks.

Maksut Shadayev: It seems to me that the regional and federal authorities have not been working with foreign BI products for a long time... If this is not the case, tell us what your interesting use is. But, in general, I see that both in the tax service and in the analytical center of the government of the Russian Federation, in the situation centers - Russian BI products are used everywhere. Moreover, their line is quite large. BI products are a competitive market and I have not heard of import substitution issues in this solutions segment.

If we are talking about choosing the best solution, then, perhaps, the only way to choose from a range of proposals is to analyze implementations, study prices. We will not do this work for the customer. I can only once again note that within the framework of the showcase of products of domestic software that we are now doing, information of this kind will be presented in a convenient mode: through ratings, customer ratings, lists of customers of a particular solution. When we launch this showcase, you will be able to select the desired category, for example, BI or data warehouse, and see inside a list of solutions with specific ratings. We have yet to agree with industry associations on how this rating will be formed.

Maksut Shadayev: Our task is to help domestic developers in all possible ways: in terms of protection from inspections, simplification of access to financial resources, preferential loans, grants. Will we somehow control the development of products? It doesn't seem much needed... Any company has entrepreneurial risks, for example, a company may not withstand the stated pace of development. Honestly, I don't really understand the role of the state here.

Publicity, openness, competition - I cannot guarantee other ways to reduce entrepreneurial risks. I can also add a useful mechanism: for one or another end-to-end technologies such as, say, a virtualization platform, there should be three main players on the market that compete with each other. True, in practice, a situation sometimes arises now when there is no Russian solution at all. There is a different situation: large companies - especially government agencies love it - begin to create their own platform. For example, there are companies that are trying to develop their own package of engineering software for state subsidies, and this despite the fact that there are companies on the market that are developing well in this direction. And they would be interested in large companies ordering them to develop their commercial products. Therefore, our task, rather, is to prevent our side from inefficient spending of funds (and as for state-owned companies, to fight their ambitions). That is, to tell customer companies about demanded products that are in a high degree of maturity, to explain that it makes no sense to engage in your own development when it is possible to choose a suitable product on the market.

When we agree that there is an optimal set of three competitive solutions for each category, this will imply our support for vendor leaders. But we must agree with the entire market: so that everything understands that three to four leading vendors in the engineering software segment, three to four virtualization platforms, cloud platforms, etc. And when these leaders are determined in the decision segments, they, having received the status of leaders, will publicly bear appropriate obligations, primarily moral ones. Of course, this does not guarantee 100% that one of them will not go bankrupt at some point. But there should be no other way of control than market control, I believe. After all, do not put them in a sharashka?

Maksut Shadayev: By the end of summer, such a decision will be made. And it will concern not only state-owned companies. Any industrial enterprises, if they have a need to deploy such networks on their sites, will have this opportunity. There will be no discrimination on the principle of "state - not state."