Domestic Software Substitution in Russia: Progress, Hurdles, and Policy Drivers

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By 2025, a minority of companies will have fully replaced imported foreign software, while the majority will continue the transition beyond that year, extending into 2030. This projection comes from a study conducted by the Russian firewall developer Ideco, with results published on socialbites.ca.

The Russian software market, though growing, remains less diverse than its foreign counterparts. This narrower range of options can constrain businesses when they face complex or niche needs. As a result, only a fraction of companies have managed to move away from foreign software, with estimates suggesting about 25-30 percent have achieved this shift. Experts note that the composition of those who have succeeded is mainly state-owned entities, which account for roughly 86 percent, while private companies and startups make up about 24 percent, a level that illustrates the uneven pace of substitution against the current backdrop.

Ideco’s figures also show that 13 percent of firms that have not yet completed the switch to domestic software argue that replacing foreign solutions has not yielded sufficient functionality. A segment, about 28 percent, expresses distrust in domestic software. More than half, around 52 percent, cite difficulties in transferring all organizational processes to other equipment as the main hurdle delaying the transition. A small 7 percent could not specify the reasons behind the delay in import substitution.

In May 2022, President Vladimir Putin issued Decree No. 250, directing Russian companies to transition from foreign to domestic software solutions. The decree underlines a strategic aim of sovereignty and independence from foreign technologies. The broader intent is to strengthen control over information networks, enhancing the safety, security, and confidentiality of data handled by Russian enterprises through domestic solutions.

Earlier discourse highlighted the employment landscape for IT professionals, noting that a significant portion of Russian specialists faced challenges finding roles in international companies. This context underscores the broader shifts underway within the national tech ecosystem as firms recalibrate their software strategies and workforce planning in response to policy and market changes.

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