Transcript Russian IT Industry & Education

Russian IT Industry & Education
Богатство России обучением прирастать будет!
- М.В. Ломоносов
Birger Steen
General Manager
Microsoft Russia
April 27, 2006
Welcome to Academic Days 2006 Moscow!
• Fourth event of its kind (two events organized by Microsoft Research, last two
events – by Microsoft Russia)
• Nearly 300 lecturers and researchers participating this year:
–230 from Russia (75+ from Moscow, 26 from St. Petersburg, 14 from Novosbirsk,
12 from Tomsk, 7 from Nizhni Novgorod etc.)
–28 from Ukraine (Kiev, Kharkov, Lvov, Odessa, Donetsk etc.)
–15 from Baltic states (Estonia, Latvia, Lithuania)
–8 from Kazakhstan
–2 from Armenia
–1 from Finland ("Leningrad Region")
• Speakers from Microsoft USA, Microsoft Research, Microsoft Russia and two
Russian universities
Agenda
5
min
• Overview of Russian IT Market
5
min
• Barriers for Growth of IT Market
10
min
• What Needs To Be Done
10
min
• Microsoft's Commitment to Education
Russia Is Attractive For Investments
Ford already
invested USD
150m+ in assembly
facility
Toyota started to
build its autoassembly Greenfield:
first wave investment
– USD 143m
Overall, IKEA made
more than USD 1bn
investment, and is
planning to invest the
same amount within
next 2 years
Siemens invested
USD 125m+ to
production capacity
Disposable income per capita*
USD
Positive outlook
• Large market
• 6 times bigger
•
than in India
3.8 times bigger
than in China
1,166 1,384
1,816
2,301
+18%
2,909
3,451
3,916 4,269
4,759
5,180
–
–
–
–
–
Population 143.4 million
Labor force 74.2 million
54 million households
GDP per capita: USD 10,750 at PPP
104 million mobile subscriptions
sold
• Inward direct investments USD 17bn in
2005
2001
02
03
04
05
06
07
08
09
2010
• Russia’s high level of foreign currency
reserves (USD 120bn)
Nominal GDP
USD Billion
• Low level of external debt
"…our target is to double GDP
within next 10 years…
V. Putin Russia's President
+17%
750
307
345
432
878
987 1,057
1,180
1,289
• Strong consensus among political
leadership team
• Vital reforms initiated
581
• Support for international cooperation
• High quality and low cost of human
2001
02
03
04
05
06
07
08
11 time zones
* Income after tax
Source: EIU; Goskomstat
09
2010
resources
IT Spending In Russia Is Projected To Double Over The Next 5 Years
USD Billion
Forecast
21.84
+18%
+37%
Packaged software
Services
Hardware
4.93
0.61
5.76
0.74
1.16
1.38
3.17
3.64
2002
03
Source: IDC Blackbook; Euromonitor
9.28
1.07
1.87
6.34
04
11.36
1.27
2.36
7.72
05
13.59
1.53
16.07
1.83
18.70
CAGR
20%
2.65
2.20
5.80
CAGR
25%
13.38
CAGR
15%
4.66
3.73
2.97
9.09
06
10.51
07
11.83
08
2009
Unique Market: Educated Population with low salaries and high growth of IT
Education:
Literacy among 15+ population
- 1,097 universities, 364k professors, 6.8M students
- 6,200 prof schools, 137k teachers, 4.1M students
- 64,000 schools, 1.6M teachers, 16.6M pupils
- 99.4% literacy among 15+ population
- 16% of total population and 23% of working population with higher education
Russia
99.4%
China
90.9%
Brazil
88.4%
India
61.0%
Science and IT:
# of Researchers
- 125k software developers
- 492k researchers
- 200k technical graduates with higher education each year
US
1 317 238
China
819 651
Russia
492 040
Average Salaries in IT:
Germany
265 538
- 4 kUSD for researchers and 9 kUSD for software developers in Russia vs. 65-80
kUSD in US and Western Europe
India
125 946
Brazil
62 042
Share of GDP from SW production
Russia
The potential:
0.15%
UK
2%
US
3%
India
8%
Developers & IT-pros
•Two pipelines:
– CS/SE students graduate from universities
– Non-software engineers learn how to program
• 35 % of Russian developers are working in export segment of
Russian software development industry (mostly software outsourcing)
• There are also 330 K IT-Pros in Russia
Universities / Students
•
•
•
•
Total number of students in Russia is ~6,000 K
Total number of technical students in Russia is ~1,500 K
There are 2,400+ state and private universities (with branches)
Approximately 650 universities are teaching software developers
Russian R&D Pool
• 950 K top-level scientists and researchers with leading edge domain
knowledge and/or fundamental science skills
• About 50 % of them could easily learn how to program in a few
weeks/months
Source: Microsoft; CMU, UNESCO
Region
Develo
pers
Dev
Students
Central Region
(includes
Moscow)
28 %
33 %
North-West
Region
(includes St.
Petersburg)
14 %
14 %
Volga Region
20 %
20 %
Ural Region
13 %
6%
Siberia Region
13 %
12 %
South Region
10 %
18 %
Far East Region
5%
4%
Total
125 K
60 K
Agenda
5
min
• Overview of Russian IT Market
5
min
• Barriers for Growth of IT Market
10
min
• What Needs To Be Done
10
min
• Microsoft's Commitment to Education
Russia Is Utilizing Only 10% of Its Software Development Potential!
• Only 40,000 programmers are
IT Market – Russia
20%
involved in products development,
while ~100,000 are doing either
outsourcing or in-house software
development
11%
• This could be partially attributed to
piracy (but this is going down) and to
IT Market – World
lack of management and
entrepreneurial skills
41%
• Russia is competing in the wrong
component of IT market – its biggest
potential is not in services (India),
20%
not in hardware (China), but in
Source: IDC, 2004
software products development
• We forecast fast growth of software
product development in Russia in
the next few years
69%
39%
Hardware
Software
Services
Hardware
Software
Services
Piracy
Counterfeiting today is a huge issue for our country. Russia
will never become an intellectual property producer if situation
remains the same.
Mr. Gref, Minster of Economy and Trade RF
The involvement of
intellectual property in the
national economy is vital
to ensure technological
and economic safety
Mr. Fradkov, Prime
Minister of Russian
Federation
Our primary goal is to create favorable
environment for the growth of Russian
business using IP …protected intellectual
property should form a cornerstone of the
new Russian economy.
Mr. Fursenko, Minister of Science and
Education
…. Folks, I encourage you to use legitimate software.
Be it Microsoft, or not… But let it be genuine one! …
Quote from Internet community influential, who is MS skeptic,
runs OS/2 and Linux but admires Word and claims it to be the
best ever word processor that really “knows the Russian
language”
Lack of Management Skills
• "Traditional" challenge since Soviet times
• Russian Education system is mostly technical-oriented and geared toward
fundamental sciences
• Lack of middle managers in IT industry is mentioned as one of "institutional
problems" in "Conception of developing IT market in Russia" published by
Ministry of IT and Telecommunications in 2005
• Until recently, there were no formal education programs for training IT
managers, and even now this kind of degrees is a rarity
Agenda
5
min
• Overview of Russian IT Market
5
min
• Barriers for Growth of IT Market
10
min
• What Needs To Be Done
10
min
• Microsoft's Commitment to Education
Beating Piracy
• Institutional problem in all emerging markets
• However, growth of Russian middle class drives the piracy down – from virtually
100% to estimated 85% this year
• There are some successes in fighting piracy in Russia:
–Changes in sales to Russian corporations (it is no longer about selling Windows
only)
–Two years ago more than 70% of all computers were sold with unlicensed OS,
now this figure is less than 50%
–Russia is 3rd worldwide in sales of Windows Media Center (after USA and Japan)
• Legislation and enforcement support in fighting piracy from the government
• Still a lot to be done – starting with mindset on intellectual property
–If we cannot teach our students to pay for software, then how do we make them
pay for education?
Role of Education in Supporting Growth
• Education is a Business!
• It is possible to significantly increase the number of people studying for IT degrees
by capitalizing on existing market opportunities:
– Launch Bachelor and Master programs in "Software Engineering", "Information
Systems" and "IT Management" (already in progress at the leading universities,
such as Moscow State University and Higher School of Economics)
– Increase the number of offerings in IT re-orientation and 2nd higher education
programs, such as "Software Development for Technical Engineers"
– Restore system of mass professional education (basic IT skills)
– Offer distance learning courses, which are especially important for Russia with its
huge geography
• Topics that will be "burning hot" in the coming years include: Software as a
Business, Software Entrepreneurship, Software Marketing, Software Project
Management, Technical English
Increasing Importance of IT in Public Sector
Priorities for developing IT Market till 2010 as stated by Ministry of IT and
Telecommunications:
• Increase fixed phone lines per capita (from 0.28 to 0.43)
• Increase PC per capita ratio (from 0.1 to 0.43)
• Increase Internet penetration in Russia (from 13% to 45%)
• Increase the share of IT in Russian GDP (from 5% to 10%)
• Increase share of ICT products and services in Russian export (from 1 to 4%)
• Increase the percentage of people employed in IT industry (from 1.8 to 5%)
Other important things to do:
• Improve Legislation (including Laws and Regulations on Intellectual Property Rights
and Electronic Signatures)
• Invest in IT usage and IT skills in Government bodies
Agenda
5
min
• Overview of Russian IT Market
5
min
• Barriers for Growth of IT Market
10
min
• What Needs To Be Done
10
min
• Microsoft's Commitment to Education
Microsoft Is Committed To Solving Problems Together with Education
• …by fighting with software and intellectual property piracy
• …by creating technologies for university infrastructure (Windows, Office,
Class Server, Learning Gateway)
• …by developing methodologies for teaching IT in high school and non-IT
university specialties (e.g. "Microsoft Office for teachers" series)
• …by supporting curricula for IT specialties in universities (see MSDN AA
Curricula Repository)
• …by sponsoring scientific and education conferences in Russia (Academic
Days, Summer schools, IT Education in Russia)
• …by advancing scientific research at universities through Microsoft
Research
Developing Management Skills and Entrepreneurships
• Development of education
environment:
– Starting to teach IT early and
supporting transition from high
school to university ("Partners in
Learning" courses)
– New business models for
education (Microsoft IT
Academy)
– Supporting new specialties in
higher education (Software
Engineering, Business
Informatics etc.)
• Promoting IT entrepreneurship by
competitions such as Russian
Imagine Cup 2005 Champions – Russian team
Innovation Fair or Imagine Cup
Microsoft Amazing Potential Award
• Announcing Microsoft "Amazing Potential" award for students
• Award is designed to recognize the best IT students of Russia
• Requirements for applying for this award:
– Student of Russian university
– Recommendation of Professor or Assistant Professor of Russian
university
– CV of candidate in English (1 or 2 pages)
– Proven IT skills and knowledge
• An award will be made either as cash stipend of $1,000 or as a Travel
grant for the same amount
EDUCATION FOR THE 21ST CENTURY
Strategic initiatives
Invest in IT
skills to
improve
ICT use by
PS and
Education
• Re-train PS employees to ensure MS-based IT skills
•
•
Drive demand
to increase
effectiveness
of Russian
Education
•
are in place. Accelerate usage of LRG Solutions.
– Introduce curriculum and provide on-the-job and
vocational training for ALL public servants. IW / LRG.
– Cover ALL state-run training institutions for roll-out
– Ensure state funding to support MS Initiative
Build content development process to support broad
adoption of MLG Solutions and LSE Initiative
– Invest at initial stage (3 years) to create demand
– Partner with Government to facilitate development of 3 rd
party business model to expand further
Build Centers of Excellence in all Federal Districts to
demonstrate best-in-class MS Solutions (MLG)
– 14 Centers in 7 Districts. Cover rural and municipal
centers in each District.
– Invest in TTT and post graduates to adopt Solutions
Run GAPP to create demand for best-in-class
Education / Solutions available
– Partner with Government and Industry
– Focus on Student and Teachers, continue with Public
Servants and Security/Military
– MS to provide SW, discounts, enhanced business
models (ex., Powerline)
Impact, metrics and investments
• Impact in 3rd year
– PS Servants training on MS
Technology: 800k
– LRG Solutions penetration in
Federal PS: 80%
• Metrics to monitor
KPIs/ years
FY07 FY08 FY09
•
•
•
•
100k 250k
20k 80k
5
4
5
4
# of PS servants
# of IT courses
# of Centers
# of MGL projects
450k
160k
5
15
• Investments (cumulative) – 110 mln
rubles!
© 2006 Microsoft Corporation. All rights reserved.
This presentation is for informational purposes only. Microsoft makes no warranties, express or implied, in this summary.