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The heart of tech

This article was published on July 26, 2012

    Issue v0.7: Emerging Markets Russia – Technological Potential of Russia

    Issue v0.7: Emerging Markets Russia – Technological Potential of Russia
    Thomas Offinga
    Story by

    Thomas Offinga

    Thomas is the lead designer and producer of TNW Magazine, The Next Web's own digital magazine. When he isn't designing the magazine, he's pr Thomas is the lead designer and producer of TNW Magazine, The Next Web's own digital magazine. When he isn't designing the magazine, he's probably creating something else in his spare time. You can follow him at @thomasoffinga

    What is the technological potential of Russia and could the new Google or Amazon emerge from Russia? 

    Dyson: Actually, you could argue that the old Google did emerge in this country: search-engine company Yandex started about a year before Google. But unlike Google, it lacked a huge domestic market, so it now trails the US company in size though it remains one of the world’s top-three search companies. 

    Obstacles

    The biggest obstacle to becoming a world player in Russia are two-fold. One is the lack of a large, competitive domestic market, though that is now changing as Russia has become the largest Internet market in Europe.

    The second is the relative immaturity of Russia’s business culture; although there is huge technical talent, which you can be born with, few people have management and business skills, which are best learned through experience and through working with good managers. To some extent you can see this now in Silicon Valley. It’s easy to build an app, but hard to build a company around the app — which is why so many startups are getting acquired.

    Of course there are the usual issues around bureaucracy and the like, but those are minor compared to the first two.

    In the future, however, Dyson expects to see more and more world players emerging from Russia, which has not only technical talent but imagination and creativity.

     

    The Influence of Technology on Development in Russia

    Technology – and more specifically, information technology — is beginning to have a strong influence on Russian economic development.  It brings three things into the economy: efficiency, transparency and a change in the balance of power between individuals and large institutions. The first two are fairly obvious; the third is worth explaining.

    It is much easier to operate as an independent individual or a small company in the age of the Internet. In the past, economies of scale gave power to big institutions; now, smaller entities or individuals can acquire information and reach markets almost as efficiently (for their size) as large outfits. For many people, a computer is capital equipment that enables them to be productive and to control their own lives.

    Similarly, the Internet allows individuals to be “present” online outside their own physical presence. That gives them the ability to write their own history without the need for an institution. That changed the balance of power, and its psychological impact on people’s sense of self is a key factor in Russia’s future development.

    Written By
    Esther Dyson 

    A former journalist, Wall Street technology analyst, angel investor, entrepreneur. She’s a lifelong Russia fan who’s fluent in the language and on the boards of several Russian technology companies including AO Yandex, Russia’s largest search company..