Russia: Internet Diffusion

IT in the Russian Federation

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National IT Strengths & Weaknesses Size of Domestic IT Market National ICT Policies Telecommunications Infrastructure Telecommunication Deregulation & Liberalization Computing, Internet Diffusion & Cultural Attitudes toward Technology ICT Usage by Businesses: Electronic Commerce & E-Business E-Government Domestic Production: Software Development, Hardware Manufacturing, R&D IT Workforce IT Geographics IT Financing IT Legal Environment	Russia: Computing, Internet Diffusion & Cultural Attitudes toward Technology Overview Studies suggest that the Russian market is following a similar pattern of internet adoption as occurred in North American and Western Europe. Although Moscow and St. Petersburg make up 44.2% and 10.6% of Russia’s web users respectively, the regional penetration numbers are growing. (36) 40% of Runet citizens live in cities with populations of under 1 million people and Siberia and the Far East account for the largest share of the Runet regional audience. (38) In my opinion, the two biggest hindrances to penetration are infrastructure and disposable income. I think that once the government follows through on its eRussia initiative, the Russian penetration will explode, especially in the more educated populations. Key Stats Number of websites: 16,964,567 (38) Web Users as a percent of the population: 5% (about 6 million) (36) PCs per 1000 people: 84 (40) Broadband vs. Dial-up In terms of household use, dial-up is really the only option for the Russian population. Less than 10% of Russian households have a PC and of those only 5.18% are connected to the Internet. Spending on ICT per month is about $4, the majority of which is most likely telephone costs. Only 2% of the population has broadband access which is limited to large corporations and ISPs due to cost. (35) In 2001, 63% of Internet users in Russia accessed the Internet at work. (32) Stimulus for IT growth & Attitudes toward IT diffusion “While it took about 15 years for color TV to reach 5% of Russian urban population, it took less than eight years for the World Wide Web to reach the same number of users in Russia (www.km.ru).” (36) This penetration is attributable to several characteristics of the Russian population. First, a majority of Russians are technically savvy having advanced degrees in science and engineering. Second, Russians are learning that in a capitalist market, keeping up with technology is one key success factor. And finally, having access to global information is a relatively new concept. ICT for development (mobile PCs, cybercafés, internet kiosks, etc.) In the beginning of 2003, there were 2600 public internet access outlets in Russia. Under the CyberPost program, part of eRussia, the government plans to expand this to all Russian post offices by 2008 totaling 12,000 outlets. (34)

National IT Strengths & Weaknesses

Size of Domestic IT Market

National ICT Policies

Telecommunications Infrastructure

Telecommunication Deregulation & Liberalization

Computing, Internet Diffusion & Cultural Attitudes toward Technology

ICT Usage by Businesses: Electronic Commerce & E-Business

E-Government

Domestic Production: Software Development, Hardware Manufacturing, R&D

Russia: Computing, Internet Diffusion & Cultural Attitudes toward Technology

Overview

Studies suggest that the Russian market is following a similar pattern of internet adoption as occurred in North American and Western Europe. Although Moscow and St. Petersburg make up 44.2% and 10.6% of Russia’s web users respectively, the regional penetration numbers are growing. (36) 40% of Runet citizens live in cities with populations of under 1 million people and Siberia and the Far East account for the largest share of the Runet regional audience. (38) In my opinion, the two biggest hindrances to penetration are infrastructure and disposable income. I think that once the government follows through on its eRussia initiative, the Russian penetration will explode, especially in the more educated populations.

Key Stats

Number of websites: 16,964,567 (38)
Web Users as a percent of the population: 5% (about 6 million) (36)
PCs per 1000 people: 84 (40)

Broadband vs. Dial-up

In terms of household use, dial-up is really the only option for the Russian population. Less than 10% of Russian households have a PC and of those only 5.18% are connected to the Internet. Spending on ICT per month is about $4, the majority of which is most likely telephone costs.

Only 2% of the population has broadband access which is limited to large corporations and ISPs due to cost. (35) In 2001, 63% of Internet users in Russia accessed the Internet at work. (32)

Stimulus for IT growth & Attitudes toward IT diffusion

“While it took about 15 years for color TV to reach 5% of Russian urban population, it took less than eight years for the World Wide Web to reach the same number of users in Russia (www.km.ru).” (36) This penetration is attributable to several characteristics of the Russian population. First, a majority of Russians are technically savvy having advanced degrees in science and engineering. Second, Russians are learning that in a capitalist market, keeping up with technology is one key success factor. And finally, having access to global information is a relatively new concept.

ICT for development (mobile PCs, cybercafés, internet kiosks, etc.)

In the beginning of 2003, there were 2600 public internet access outlets in Russia. Under the CyberPost program, part of eRussia, the government plans to expand this to all Russian post offices by 2008 totaling 12,000 outlets. (34)