Top Tech Stories April 18: Russian businesses adjust to deeper isolation

EXODUS CONTINUES

Foreign companies continue to flee the Russian market or suspend their activities in the country. These include L’Occitane, Fiverr, Tenaris, KONE, Huhtamaki, Metsä Group, Servier, Munich Re Group, Infosys, TUI Group, Petropavlovsk, FMC, Konica Minolta, Nemark, HHLA, Jungheinrich, Wärtsilä, Kurokesu. Some of them initially have decided to stay in Russia, but changed their minds as the Russian invasion of Ukraine continues. [Source: Telegram channel The Provisional Government]

Even popular fonts are not safe: US company Monotype Imaging has prohibited access to popular fonts like Times New Roman, Arial, Helvetica, Tahoma, and Verdana for Russian users. The products containing these fonts purchased before the Russian invasion of Ukraine will continue to work. [Source: Radio Liberty]

WAR IN UKRAINE

Rinat Akhmetov, a Ukrainian business tycoon, pledged to restore the besieged city of Mariupol where he owns two steel plants. A place of heavy battle, the city has been suffering from devastating destruction. [Source: Kyiv Independent]

The Ukraine hi-tech sector is adapting as the war approaches two months. IT companies moved to relocate its staff to safer destinations, volunteer to help the military, and provide relief for people from war-struck areas.  [Source: TechCrunch]

REGULATION

Russian President Vladimir Putin has signed a law on delisting of Russian companies’ shares and depositary receipts from foreign exchanges, which was adopted by parliament earlier this month. The bill requires the receipts to be converted into equities traded in Russia to secure them from additional sanctions. [Source: Vedomosti]

The Kazakhstan government has broken an agreement signed last year to work with Russian bank Sber on digital transformation. Kazakhstan cited “geopolitical situation,” noting they will rely on local IT experts to build the government’s digital platform over the next two to three years. [Source: Orda]

Russia’s Security Council, a national consulting body, has established a special commission to address the issues of the country’s “technological sovereignty.” The group is run by the former president and current council’s executive chair Dmitry Medvedev to oversee critical IT infrastructure and domestic production of IT services and products. [Source: TASS]

CYBERSECURITY

In Russia, demand for domestic software sees an exponential growth as Western software majors are leaving the market. It’s driven by surging interest from both big private companies and the government sector. [Source: 3Dnews]

Engineers from the Samara State University designed a solution for monitoring Internet connection quality called NetTestBox. The idea is to detect “foreign-sourced traffic” to enhance national security. [Source: Izvestia]

Russians are increasingly using VPN services to gain access to social networks and websites blocked by the country’s government. A mobile operator Yota reported the traffic through VPNs increased in March by 69 times compared to the first week of January 2022. [Source: East West Digital News]

FIGHT FOR TALENT

A UK-based startup with Russian founders Immigram raised $500,000 in investments on the back of a surge in the number of Russian IT professionals and entrepreneurs relocating to the U.K. Immigram is a platform for the employers looking for a hi-tech labor force and the employees seeking help with relocation. [Source: TechCrunch]

A Russian startup Collider opened its first coworking space outside the country in Armenia’s capital Yerevan. The country has recently seen an inflow of Russians fleeing from the war and economic turmoil. Investment of $25,000, with the return on investment expected by the end of 2022. [Source: RB]

A special secondary IT school will be established in Almaty, the former capital of Kazakhstan. Graduates will be trained to work as IT specialists and at the same time join prestigious universities. [Source: Orda]

HEALTHCARE

Russians face a lack of vital medicines. The shortage was caused by a halt in supplies of imports and the rush by consumers to stockpile medicines over fears of possible stop of sales.  [Source: The Insider]

The State Duma, a lower-house of the Russian parliament, will consider a draft of a bill allowing supplies of blood plasma to pharmaceutical companies. The initiative, if signed into law, will enhance the domestic production of medicines.  [Source: Kommersant]

THE RISE OF LOCAL ALTERNATIVES

The number of bank cards issued on the Union Pay platform by Russian banks increased ten-fold throughout March, reaching 500,000 after MasterCard and Visa have blocked Russian cards outside Russia. Although some overseas marketplaces ban Russian Union Pay cards as well. [Source: Kommersant]

Russia’s 3D.ru company will manufacture 3D printers locally to replace imported products. The manufacturer plans to switch to domestically-sourced components to reduce its dependence on imports within two years. [Source: Comnews]

Russian marketplace Ozon has launched a hotel booking system for individuals through its service Ozon Travel after Booking.com suspended its business in Russia. Now 70,000 accommodation facilities in a few countries are available. [Source: VC]

E-COMMERCE

Moscow entrepreneurs will be promoted on the Chinese marketplace WeChat. The Moscow government will fund the placement of goods in a dedicated section “Made in Moscow” for a period of up to 10 months. [Source: Moslenta]

Marketplace Ozon purchased a famous TV set brand Hartens to produce TV sets under its own trademark. 100,000 units are expected to be manufactured this year. [Source: Kommersant]

Sales of printed books surged in Russia in March, with demand driven by psychology books and the works of George Orwell. Marketplaces Ozon and Wildberries saw growth rates of 30% and 75% respectively year-on-year, while the publishing house Eksmo sold 20% more printed books than in March 2021. [Source: Vedomosti]

Russian online cinema Kinopoisk’s sales more than doubled in 2021 to nearly $90 million. The company ranks second to the market leader IVI, which had total sales of $150 million in 2021. [Source: Forbes]

A Russian vitamin subscription startup Halsa, which was founded in 2019, raised a $500,000 round. The company with 250,000 clients will spend the money on expansion of production and development of AI-based algorithms. [Source: VC]