Photo: FSUE ATM State Corporation
According to the results of 2020, the Runet’s economy can grow by only 6–10%, which is a crisis for the IT industry. The adverse scenario suggests an increase of around 5%. Such forecasts were voiced by the executive of the Association of Electronic Communications (RAEC) Sergey Plugotarenko at the IT breakfast “Digital challenges of a new reality: who will help whom?”. Traditionally, this event takes place as part of the SPIEF, but this year, in line with the trends of recent weeks, it was held online.
Last year, according to RAEC, Runet’s economy grew by 15%, in some segments — by 19%. This is the most significant growth rate since 2014. The contribution of Runet to the Russian economy in 2019 amounted to 6.4 trillion roubles. This year, you should not expect such numbers. The pandemic is slowing down the IT industry, not only in Russia but also throughout the world. According to Gartner, the global decrease in IT costs will be as much as 8% this year. Companies are redirecting reserves to maintain the business and critical to this initiative. In Russia, revenue in the first quarter was reduced by almost 40% of IT companies, and 82% report a delay in payments for already finished work.
But in the new reality, as shown by two months of quarantine, it is the technology that is becoming one of the main competitive advantages of the business. Therefore, those who do not reduce, but, on the contrary, increase investment in IT will survive the crisis, the meeting participants are sure. An online survey conducted during the event revealed that 76% of experts regard the 2020 crisis as new opportunities for the industry. At the same time, market participants insist that the IT industry should be included in the government list of those most affected by the crisis. The main thing in the IT industry is personnel and, accordingly, the payroll fund. People costs account for about 80% of total expenses, so the sector needs social tax benefits. Experts predict that job cuts in IT will have lasting adversarial outcomes.
In the past two months, according to Sergey Kuchushev, Ozon Director of Government Relations, e-commerce companies have launched an exchange program for their specialists. This has had a positive effect on the industry. However, now, he said, tax breaks are needed for companies that have shown a decline in revenue.
Russia is already in great need of IT staff. According to RAEC, now there are about 1.8 million IT specialists in different fields of the country. This is 2.4% of the economically active population (for comparison, in Germany — 4%, in the UK — 5%, and in Finland — 7%). The total need for IT personnel in Russia is 222 thousand a year. And by 2024, this figure is expected to rise to 300 thousand.
Personnel and liquidity are the critical parameters for development, confirmed by companies included in the RVC ecosystem. According to Mikhail Antonov, Deputy General Director of RVC, the goal of the development institute is to create additional demand for IT industry solutions. Therefore, it was announced the acceptance of applications for grant support under the NTI "anticompetitive" projects. This is not only about medicine, but also about any developments related to remote work, for example, or equipment for clean areas. These applications allow us to maintain social distance and, in general, make our life more suitable to a new reality. Antonov added that companies have the opportunity to undergo a quick evaluation of projects and start receiving financing from July.
Experts note several trends that the pandemic has brought to the IT landscape. Among them, the General Director of the MDG Group of Companies Dmitry Dyrmovsky singled out a huge demand for solutions for remote work, public cloud services, IP-telephony, and video conferencing. In April, the need for such solutions raised by almost 40% compared with March.
Another trend is related to automation — bots and analytics, which were previously used to enhance customer experience, but are now crucial for survival due to the sharply grown load on remote channels. Bots become accountable for the formation of operational data flows in a pandemic. Technical solutions to convert voice to text can save doctors from routine paperwork. Contactless solutions are becoming more popular than ever before. Temperature sensors, for example. Face recognition systems are also in demand. To confirm the identity, biometrics began to be used even more actively.
Experts concluded that to mitigate the effects of the IT industry crisis, it is essential to improve the partnership between the government and market participants. The state needs tax incentives, support in the formation of demand. IT companies must quickly modify their product portfolio to market necessities. Joining forces with the state will help both the IT industry and its customers.
By: Evgenia Noskova.