You may think, as I did, that Russia's current tech woe's are as a result of their invasion of Ukraine, or perhaps the annexation of Crimea. But it seems that the real problem started back around 2011 when it decided that the population having free access to information was not a good thing and, anyway, there must be money to be made if someone can take the tech industry under their control.
In Russia, technology was one of the few sectors where people felt they could succeed on merit instead of connections. The industry also maintained a spirit of openness: Russian entrepreneurs won international funding and made deals all over the world. For a time, the Kremlin seemed to embrace this openness too, inviting international companies to invest in Russia.
But cracks in Russia's tech industry started appearing well before the war. For more than a decade, the government has attempted to put Russia's internet and its most powerful tech companies in a tight grip, threatening an industry that once promised to bring the country into the future. Experts MIT Technology Review spoke with say Russia's war against Ukraine only accelerated the damage that was already being done, further pushing the country's biggest tech companies into isolation and chaos and corralling its citizens into its tightly controlled domestic internet, where news comes from official government sources and free speech is severely curtailed.
"The Russian leadership chose a completely different path of development for the country," says Ruben Enikolopov, assistant professor at the Barcelona School of Economics and former rector of Russia's New Economic School. Isolation became a strategic choice, he says.
The tech industry was not Russia's biggest, but it was one of the main drivers of the economy, says Enikolopov. Between 2015 and 2021, the IT sector in Russia was responsible for more than a third of the growth in the country's GDP, reaching 3.7 trillion rubles ($47.8 billion) in 2021. Even though that constituted just 3.2% of total GDP, Enikolopov saysthat as the tech industry falls behind, Russia's economy will stagnate. "I think this is probably one of the biggest blows to future economic growth in Russia," he says.
[...] Yandex is just the latest example in the Kremlin's long history of trying to take control of Russia's tech companies, fearing what might result from the population's unfettered access to information online. These efforts date to 2011, when Facebook and Twitter helped spark the largest antigovernment protests in the country since the 1990s.
Some in the tech industry joined the protests, hoping to help put Russia on a more liberal, democratic path. Igor says he was one of them. But he gave up on protests after a few years. "It felt hopeless," he says.
In the ensuing years, Russia imposed increasingly restrictive laws, arresting social media users over posts, demanding access to user data, and introducing content filtering. This put pressure on both Western social platforms such as Facebook, Twitter, and LinkedIn (which has been blocked in Russia since 2016) and their domestic counterparts.
VKontakte, often described as Russia's Facebook, was "de facto nationalized" after its founder, Pavel Durov, was squeezed out of the company in 2014 and Kremlin-aligned oligarchs assumed control, says Enikolopov. After fleeing the country, Durov, who would later go on to create the messaging app Telegram, described Russia as "incompatible with Internet business." According to a study from the National Research University Higher School of Economics, more founders of "unicorn" startups leave Russia than any other country.
The Russian government thought it should control everything, says Enikolopov: "Tech companies could not be left alone."
The entire article is an interesting read if you have a few minutes to spare...
(Score: 4, Interesting) by Freeman on Wednesday April 05, @05:51PM (6 children)
Or was that "military action", certainly not an invasion. Let's go back to the golden years of the Cold War. Too bad there's no Berlin Wall to tear down. At least then, we would know when it's over.
Joshua 1:9 "Be strong and of a good courage; be not afraid, neither be thou dismayed: for the Lord thy God is with thee"
(Score: 1, Interesting) by Anonymous Coward on Wednesday April 05, @06:53PM
> Let's go back to the golden years of the Cold War.
Back then Titanium was a big part of high tech weaponry. On our side, think Skunk Works and the SR-71 Blackbird recon aircraft. Russia had a lot of Ti, enough that they built whole submarines out if it https://sites.tufts.edu/fletcherrussia/we-have-things-to-say-about-russias-titanium-submarines-the-u-s-navy-has-none/ [tufts.edu]
While they were faster and could dive deeper than NATO subs, it turned out that they failed on the next tech escalation--they were relatively noisy and easy to detect.
(Score: 3, Touché) by DannyB on Wednesday April 05, @08:13PM
That was a Special military action.
Special. Very special.
How often should I have my memory checked? I used to know but...
(Score: 2) by legont on Thursday April 06, @03:08AM (3 children)
Funny you mention the Berlin Wall cause since it went down the West build tens of thousands miles of walls all over. So, wake me up when they are teared down. Until then, nothing is over.
"Wealth is the relentless enemy of understanding" - John Kenneth Galbraith.
(Score: 3, Funny) by driverless on Thursday April 06, @06:14AM (1 child)
Houses tend to fall down without them so this is quite understandable.
(Score: 2) by kazzie on Thursday April 06, @05:51PM
Get rid of those ceilings: make room for blue-sky thinking!
(Score: 1, Touché) by khallow on Friday April 07, @12:02AM
Cool narrative, but you have any facts to go with that mileage? And are any of those walls shoot to kill?
(Score: 4, Interesting) by krishnoid on Wednesday April 05, @06:16PM
A decent chunk of the technology arena is tools, increased speed, and automation (and observability), which can be layered into more of the same. I'd go out on a limb and say the more that those in power want to tighten their grip, the more (star systems) er, ideas will slip through their grasp when technology is available to the masses.
Individual creators can use those elements of technology to exercise their personal power along the lines of their own talents, and eventually distribute the results to the masses. Consider everything from fire to the wheel to a megaphone to gunpowder to the printing press to digital cameras, and you see how centralized power becomes decentralized in the presence of technology.
So it's not hard to see why individual technology (i.e., not FCC-controlled broadcast media or city infrastructure) is at odds with people whose talent lies with exercising centralized power. One exception to this is in countries where the central government put in the controls to centrally regulate the Internet; an enormous task, but not impossible (see "observability") with large, coordinated investment.
(Score: 5, Interesting) by RamiK on Wednesday April 05, @06:59PM
Nice rhetoric. However, China was doing all of that but still managed to keep their tech industry growing just fine.
It all comes down to how much money is being poured into the sector: If you cut potential revenue sources by oppressing the sector / the populous, you need to compensate with subsidies. The Chinese did it with the likes of that 1 million strong great firewall of china thing. The Russians didn't. It's as simple as that. And the Russians been screwing up all their ventures on this point since the days of the 5-year plans, oppression or otherwise, since they just refuse to invest money into anything individuals in the Kremlin can't benefit from personally. Honestly, they should just appoint Putin as a hereditary monarch so his children will feel some measure of responsibility to the Russian economy. Cause, God knows, no one else in Russia does.
compiling...
(Score: 4, Insightful) by JoeMerchant on Wednesday April 05, @07:15PM (1 child)
>an industry that once promised to bring the country into the future.
Bringing a country into the future usually means chaos and disruption for those who currently control it / have comfortable positions of wealth and power in it - why would those people ever want to bring their country "into the future?"
Україна досі не є частиною Росії Слава Україні🌻 https://news.stanford.edu/2023/02/17/will-russia-ukraine-war-end
(Score: 4, Touché) by Anonymous Coward on Wednesday April 05, @09:14PM
> Bringing a country into the future
Doesn't Putin imagine himself as the next Peter the Great? https://en.wikipedia.org/wiki/Peter_the_Great [wikipedia.org]
Plenty of chaos and disruption during those years that turned Russia into a world power...
(Score: 0) by Anonymous Coward on Wednesday April 05, @11:57PM
The YotaPhone 4 will save Russian tech industry.
(Score: 2) by ikanreed on Thursday April 06, @04:04AM (1 child)
While I do think software and "tech" does contribute to an economy, I personally believe it can never be reasonably described as a "driver" of an economy as this article does.
At its best, software is a very sensible capital investment that reduces the need for human beings being paid a wage to do work and remove certain kinds of errors from those same processes. Those are important things to an economy(and an individual business) in the long run, but what drives an economy is the production and distribution of things people actually need.
We've gotten so used to financialization that we've been completely disconnected from what an economy actually entails. Bankers, programmers, accountants, managers, lawyers, businessmen, advertisers, investors, landlords, and telephone earpiece cleaners aren't who make the economy go. Every one of them are middlemen.
That's why Russia can continue their war even after all the sanctions, their material economy is just fine. They aren't dependent on numbers in a computer to get core things their war economy needs.
(Score: 1) by khallow on Friday April 07, @12:05AM
[...]
So are they producing and distributing things people actually need? Or are they making shells and military gear?
I suppose it's fortunate for their economy that 1% of their population has left since the war started. Less mouths to feed now. /sarc
(Score: 2) by looorg on Thursday April 06, @07:39AM
I know this ... wait for it ... wait for it ... In Soviet/Putin Russia Tech Industry Keeells You!