Microsoft, Oracle, and other major software companies doing business in Russia are expected to suffer significant losses as most local organizations switch to Russian software. The reason, of course, is the international sanctions imposed on Russia by the United States and the European Union over the Ukraine issue.
Russian spending on software is estimated at $2.9 billion (€2.5 billion), and according to a report by Bloomberg, three-quarters went to imports, with Microsoft and Oracle taking the lion's share.
But due to concerns about international sanctions following the military conflict in Ukraine, Russian companies are preparing to turn to local software, hurting sales for American companies.
Life insurance company OAO Sberbank has decided not to choose Microsoft software for its businesses and to develop an alternative solution based on open source programs, specifically Rosa-Linux along with a PostgreSQL database.
Also, natural gas company OAO Gazprom completed testing of GeoMate, its own software used for analyzing geological data and designed to replace similar programs from foreign companies including Emerson Electric Co.
The decision is not surprising, as the United States has been at the forefront of imposing sanctions on Russian companies and businessmen over the military conflict in Ukraine in which Russian troops are allegedly involved.
Local reports claim that three of Russia’s top banks are now planning to switch to domestic software as part of a national plan backed by President Vladimir Putin, including companies involved in weapons systems that have also been targeted by international sanctions.
Putin is one of the pioneers of a new law that would provide domestic software developers with 3 billion rubles ($55 million / €48.8) of budget support. The law has already passed its first regulatory approval and is likely to get the green light by the end of this year.
Microsoft has not yet made any statement about how much its business in Russia will be affected, but the company's Chief Financial Officer, Ms. Amy Hood, has said that a reduction in revenue in the country is expected due to the changing business climate.
Source: iguru
