This week and next, East-West Digital News reviews the most important developments on the Russian high-tech scene in 2015. Today the series goes on with an analysis of government policies in the field of high technologies and innovation.
In 2015 as in previous years, government stimulus played an important, if not crucial role to develop innovation in Russia. In April, RVC, the state-owned fund of funds dedicated to innovation, in partnership with Da Vinci Capital Management, created a fund of 5-billion ruble (approximately $100 million at that time), which was presented as “Russia’s first tech-IPO tech investment fund.”
Last year also saw the GenerationS accelerator program, another RVC initiative, develop cooperation with a range of large corporations. In December, GenerationS organized a competition which brought more than $2 million to 150 startups.
The IIDF (FRII in Russian, Russia’s largest Internet pre-seed and seed-stage investment fund) also launched several programs, including a Big Data program and cyber security startup accelerator.
Meanwhile Skolkovo, the international tech hub under completion on the outskirts of Moscow, continued to support Russian startups. In August, Skolkovo begun accepting applications from startups in the agricultural business, just before opening a branch in the Russian Far East.
On its side, the Advanced Research Fund (FPI in Russian) announced in August plans to develop a national augmented reality technology.
Nevertheless, venture investment from state-backed institutions declined in 2015, while state funds had accounted for an important fraction of this market during the previous year.
Slippery statements and Crimean dreams
In the meantime, the tensions with western powers put in question Russia’s high tech strategy in its international dimensions. The import substitution approach, which Russia adopted in 2014, began to materialize in 2015 through a number of initiatives in the public and private sectors.
In the technological field, however, Russia will never reach autarky, a senior Russian official warned, because Russia’s domestic market is too small and because US tech firms are too far ahead of Russian companies. In this context, producing technologies domestically will not make sense unless the rest of the world will buy them — which may require Russia to develop a political or even military presence in new areas. This would entail risks of new confrontation with the USA, the official believes.
In less slippery statements made in October, telecommunications minister Nikolai Nikiforov called the BRICS states to offer the world their own ICT products and services, in order to break America’s IT monopoly.
Soon afterwards and in the same spirit, Nikiforov told his Iranian counterpart that Russia is ready to share its modern information and communication technologies. He suggested that Yandex, the Russian search engine which already operates in Turkey, start operations in Iran. However, it turned out that Yandex was not even aware of this Iranian idea. The search company politely denied having any plans to open an office in Teheran.
Another government fantasy is to see a “Russian Silicon Valley” emerge in the disputed peninsula of Crimea. In March 2015, the speaker of the upper house of parliament Valentina Matviyenko said it was “necessary” to develop there “facilities producing microelectronic and communication devices” similar to those existing in California.
In reality, Crimea has very weak and limited capacities in these fields, as reported earlier by East-West Digital News. In 2015, the peninsula was exposed to technological regression as a range of US companies, including Apple, Valve, Visa, MasterCard and PayPal, stopped their operations in the peninsula following a US government order. The disputed territory even lacks an own power generation capacity, as bitterly experienced by its inhabitants when supplies from Ukraine were suddenly halted in late 2015 and early 2016.
