News & Publications: Doing Business in St. Petersburg

On Friday Dec. 16, members of the RUSSOFT association joined friends, colleagues and other well-wishers at the St. Petersburg Chamber of Commerce to mark the 20th anniversary of the establishment of the Russian software development industry.

1991 was a starting point for a number of new type of businesses in Russia: export-oriented, high-tech companies daring to compete with world IT leaders.

The founder of Arcadia, ZAO, Arcady Khotin, also commented in an interview for SPBIT.ru:

Of course, 20 years is a significant date… From those companies which started in 1991 — it's possible that some of them would be less successful if we wouldn’t join our efforts: first, it was “Fort-Ross” (since 1999), then — “RUSSOFT”.

Congratulations and best wishes of success to all companies celebrating their 20-year anniversary in 2011!

See also «RUSSOFT» press release.

RUSSOFT Association presents the results of the 8th Annual Survey of the Russian Software Export Industry. St. Petersburg is among the leading Russian cities both in IT services exports and IT education.
View PDF report (11 MB)

According to Rating Agency “Expert-RA”, St. Petersburg is a region with high potential (2^nd rank in Russia) and moderate risks.

According to the survey summary, the slowdown in outsourcing activities of 2009-2010 is a period of transition, paving the way for widespread transformation of outsourcing models. This year the list of outsourcing cities expanded from 50 to 100.

St. Petersburg moved 6 rows up in the ranking thus landing on the 33th place in the global top 100 list of outsourcing cities. According to Global Services Media publication, “the high technical graduate output is one of the major contributing factors which moved its ranking up”.

Detailed “Outsourcing Compendium” shows St. Petersburg among the 6 European Centers of Excellence with core specialization Engineering Design and R&D services. The list of international companies established here includes Intel, Motorola, Sun, Boeing, HP, Auriga, Google, Luxoft, EPAM and Arcadia.

General information about St. Petersburg: infrastructure, economy, investment opportunities and other facts from ModernRussia.com

In 2010, May Uffe Gardel, a journalist at Berlingske Nyhedsmagasin, visited Russia and interviewed a number of Russian software development companies. He found that there are already a number of successful samples of collaboration of Russian software developers with Danish companies: collaboration portal for child-care facilities and children's parents; Ikea directories, mobile TV etc.

Another special report, Modern Russia, tells about Russia in whole — “a neglected R in BRIC”, which is now more than corruption and oligarchs. The trade between Russian and Denmark includes a lot of various products, some major Danish companies (Carlsberg, Rockwool, Grundfos, Danfoss and F.L. Smidth) have great business in Russia. The great trade opportunities of doing business in Russia are enhanced with special services for Danish companies — such as Own Man in Russia.

The study “Top 50 Emerging Outsourcing Cities” by Global Services — Tholons, published in October 2009, ranked St. Petersburg 31^st and noted Russia among “next 5 offshore nations”. According to the research,

“Russia continues on the path of becoming one of the leaders for hitech R&D outsourcing in the world. Russia’s deepening service delivery expertise and rich talent pool have made the country a research factory for top organizations like Intel, IBM, Motorola, Samsung and Google. Being a part of the Eastern European outsourcing region has also enabled Russia to collectively share the niche service characteristic for the offshoring and outsourcing industry. The country, however, stands out in the region due to its capacity to fulfill large-scale, highvalue services, though the processing of such services are coming at an increasingly higher cost (as compared to smaller Eastern European delivery locations).

Notably, St. Petersburg is among established top 5 outsourcing cities in the areas of engineering services and health-care services, holds the 1^st place among the top 5 established R&D outsourcing centers and is mentioned among the top emerging cities in the area of product development. The report adds:

“The educational structure of St. Petersburg is capable of generating skills required to develop the city as one of the most potential outsourcing cities for product development.”

One of the first Russian regions with ambitious plans for innovation capacity building can be found in St. Petersburg. In this report, the main emphasis is on studying the attractiveness of innovation infrastructure in St. Petersburg from foreign managerial perspective. The purpose of the study is to indicate the solid building blocks for a functioning St. Petersburg innovation infrastructure, and the key challenges which concern or hold back foreign companies.