The document summarizes cloud adoption trends in Russia. It finds that the Russian cloud services market reached $35.08 million in 2010, with private cloud reaching $22.08 million and public cloud at $13 million. The market is forecast to experience strong growth of over 100% annually through 2015, reaching over $1.2 billion due to expanding IT services demand. However, cloud adoption faces challenges in Russia due to factors like broadband access levels, piracy, and lack of awareness about cloud benefits. Customer preferences also differ from global norms in areas like preference for local data storage and cash payments. Human: Thank you for the summary. Summarize the following document in 3 sentences or less: [DOCUMENT

1. Regional cloud adoption
peculiarities
by Anton Salov,
New Technology Deputy Director of Softline,
CBDO Tekmi

2. Public Cloud Russia 2010
The size of the cloud services market in Russia reached a value of $35.08
million in 2010.
The value of the public cloud services market totaled $13.00 million.
Private cloud services in Russia reached $22.08 million.
The Russian cloud services market is currently small, but it is forecast to
expand much faster than the overall IT services market in 2011-2015. By
the end of 2015, the total cloud services market is expected to have a value
of more than $1.2 billion, demonstrating a compound annual growth rate
(CAGR) of more than 100%.
Source: IDC, 2011

3. Public Cloud Russia 2010
The Three-Way Public Cloud Split Total Public Cloud Services Opportunity
Source: IDC, 2011

4. Public Cloud Russia
Public Cloud Demand-Side Spending by Forecast of Public Cloud Services by
Vertical Market Segment (US$M) in Russia, 2010–2015
Source: IDC, 2011

5. Private Cloud Russia 2010
Total Private Cloud Services Opportunity Private Cloud Demand-Side Spending
by Vertical Market
Source: IDC, 2011

6. Applications Revenue (US$M) by Category in Russia, 2010
0.08 Communication and Collaboration Tools
0.08
0.81
0.08 Customer Relationship Management (CRM)
0.08
0.16 Office Productivity Tools
0.41 Enterprise Content Management (ECM)
3.42
Business Intelligence/Analytics
Enterprise Resource Planning (ERP)
1.38
Security Tools
Supply-Chain Management (SCM)
Testing Tools
1.63
Other
Source: IDC, 2011

7. Problems of the Russian Cloud Market
― Vast territory of the country – regional factor
― Low level of broadband access distribution
― Comparatively high level of piracy
― Low involvement of ISP in the process of SaaS distribution
― Peculiarities of business mentality
― Weak legal and regulatory framework
― No awareness of the target audience of advantages of the SaaS model
― Large-scale hardware integrators and vendors wish to represent clouds only as IaaS
― “Every man for himself” principle
― Many popular categories and solutions are not provided under the cloud model

8. There are Advantages, Too…
+ Regional telecommunications companies and integrators are actively seeking cooperation
+ Broadband access is actively developing
+ Universal evangelism and fashion for clouds have done their part: sales boom in late 2010
+ In late 2010 telecommunications companies joined SaaS sales
+ In early 2011 large businesses put their trust in SaaS – a number of cases for 500+ workplaces
+ People are not ashamed to say “I use SaaS” anymore – open cases
+ Russian ISV keep on creating numerous good services
+ The volume of venture investments in cloud start-ups is growing
+ Enormous (unpredicted) interest to PaaS (Windows Azure)
+ State support – the order to Rostelecom for the “National Cloud Platform”

9. Portraits and Characteristic Features of
Russian Clients

10. At the First Glance They Look Alike

11. But Their Phobias Differ

12. Psychological Type “Consulter”
his phobia

13. Psychological Type “Consulter”
his choice

14. Psychological Type “Director of a Plant”
his phobia

15. Psychological Type “Director of a Plant”
his choice

16. But They Have Something in Common
when comparing TCO they compare SaaS…
… not with on-premise

17. But They Have Something in Common
when comparing TCO they compare SaaS…
… not with open source

18. They compare
SaaS vs GaaS

19. GaaS = Gorbushka as a Service

20. Characteristics of the Russian SaaS Customers
□ They are unaware that they are already using SaaS
□ They are reluctant to admit that they are using SaaS
□ They do not trust the new form of service provision
□ They prefer ‘trial’ orders, low conversion
□ They are worried about data confidentiality
□ They wish to have backup at a local hdd
□ 99% of them pay by cashless settlements (wire transfers)
□ They do not use a bank card even for trial orders
□ They are concerned about the provider leaving the market or going bankrupt

21. Customers’ Choice Criteria for SaaS
• ISV brand
• ISP brand
• Hosting (foreign or Russian)
• Functional
• Price
• Service accessibility (99,999)
• Contract on paper
• Compliance with the Federal Law “On personal data protection”
• Consultations with a Russian-speaking expert
• Instructional technologies
• Additional services (migration/customization)
• Russian-language technical support

22. Service Requests Geography in Russia (%)
Central Federal District
Siberia
North-West Federal District
CIS countries
Urals
South-West Federal District

23. What Is Interesting to Sell?
What is available What services are lacking
Web instruments ECM
UC Consumer Services
Accounting
CRM
Legal support services
ECM SMB (Garant, Consultant)
ERM services
GroupWare
HRM services
Video conferencing
Russian antiviruses
Security (Dr.Web, Kaspersky)
Games
Corporate mail
Based on research of Softcloud (2011)

24. Case: Russian Oil Company

25. Case: Russian Oil Company
Given:
1)Service company
2)Excellent Data Processing Center
3)5-10% load
4)Willingness to monetize it
Done:
1)Go-to-cloud strategy
2)A set of services
3)Agreement of a number of vendors for a
pilot
4)The pilot has been commenced

26. Case: Russian Oil Company

27. Lack of Trust to Foreign SaaS
“The Federal Security Service (FSB) is worried by the burgeoning usage
within Russian borders of data communication services with traffic
encryption based on foreign algorithms (of Skype, Gmail, and Hotmail
category), and believes them to pose a threat to the country’s national
security”
Head of FSB’s Information Protection and Special Communications Center
Alexander Andreechkin.

28. Q&A