Russian ban on foreign IT programs comes into force – and under scrutiny

Russian ban on foreign IT: As from January 1, the Russian public sector has been statutory obliged to specify domestically produced software instead of foreign IT solutions wherever possible, although government departments, regional authorities and state-run enterprises can still buy programs from abroad if there is no domestic equivalent or if they can argue that the domestic software does not meet their needs. But while the new regulation could threaten the position of IT giants such as Microsoft, SAP, Oracle and IBM who may lose a significant  share – estimated by the Ministry of Communications to be between 50% and 95% depending on the segment –  of the $5bn Russian market,  questions are being asked about both the wisdom and practicality of the new legislation.
As well as hitting the pockets of the multinationals, industry insiders believe that the edict could have a significant impact on the country’s banking system, including the Central Bank. “Among the government structures whose work will be affected by the new law are the Central Bank, the mayor’s offices, the government and the state banks,”  Informzaschita’s chief engineer Alexander Volzhinsky told RBTH, pointing out that they use foreign software for their operational systems, (ie Windows, Linus/Unix); for their specialized software requirements such as  CRM, ERP, SQL and ABS; and for cyber security.
While domestic equivalents exist, he warned that “domestic programs cannot substitute foreign software because they cannot guarantee the same level of support, performance and convenience,” he said.
Exactly how significant an impact the new legislation will have remains to be seen, however, and some state companies have already managed to justify their use of  foreign software. The state-run nuclear power concern Rosatom is reported to have bought Microsoft software after putting three separate projects out to tender last November, and  RusHydro has also bought Microsoft licenses for  2016-2018.

Source: rbth