Monthly Archives: July 2011

Russia’s e-book boom is a page-turner

E-books are a common sight on the Moscow MetroOn the move: E-books are a common sight on the Moscow Metro Photo: Itar-Tass

 

4:37PM GMT 24 Feb 2011

Sales of electronic books and digital readers are soaring as manufacturers exploit the poor reach of traditional publishing across Russia

With classic writers such as Alexander Pushkin still firm favourites beside detective potboilers, electronic publishing is in hot pursuit of Russia’s avid and largely 
untapped readership.

“Russia has very little physical distribution of books. There are no nationwide chains like Barnes & Noble or Waterstone’s,” said Simon Dunlop, founder of the digital download company Bookmate.ru.

A total of 80pc of books are sold in Moscow and St Petersburg, with only 20pc in the regions, according to the booksellers Bookmate and Ozon.ru. But digital distribution may overcome the challenges of selling books across this vast territory.

“With digital media there are no border controls, no customs and no transport costs,”said Mr Dunlop. With nine time zones, no other market in the world was as well-suited to e-books.

The former Soviet Union was a “nation of readers”, and Russia remains a society with literacy on a par with or higher than Western Europe. But internet piracy has held back the development of the publishing industry, with illegal downloads robbing publishers of revenues needed to back new authors.

E-books are thought to be the leading legally downloaded product on the Russian internet by industry experts; Mr Dunlop says the number of downloads from Bookmate grew exponentially in the past year.

The rising popularity of 
e-books is easy to see; it seems that every carriage on the Moscow Metro has at least one or two people clutching an e-book reader. And rising demand for affordable e-readers has already been met with a popular, cheap and effective Ukrainian-produced reader. Oleg Naumenko, 29, the Ukrainian entrepreneur who launched the best-selling Pocketbook e-reader, realised that a product designed for the Russian-language market could profit from the huge number of free (pirated) files on the internet without 
infringing copyright laws.

Before the Pocketbook, the drawback of such files was the inconvenience of reading from printouts or LED displays. Mr Naumenko’s Pocketbook e-reader range does not come cheap at around £190, but users recoup their investment quickly if they use it as a substitute for buying hard copies of books.

The crisis year of 2009 was a breakthrough for Pocketbook; it sold 142,000 devices, earning £23m. Around 60pc of the devices were sold in Russia and most of the rest in Ukraine.

According to SmartMarketing, Pocketbook captured 43pc of the Russian market, with Sony a distant second with 24pc. Pocketbook’s success was expected to continue in 2010, with earnings estimated at around £94m. Mr Naumenko has also established an e-book where 
licensed files cost a fraction of hard copy.

With a Russian population of 142 million, a total of 110 million people in the CIS online and double-digit growth in the spread of internet capability, the market has huge growth potential. “As long as people have an internet connection you can start to use the power of technology to crack open new markets,” 
Mr Dunlop said.

 

source:http://www.telegraph.co.uk/sponsored/russianow/technology/8345760/Russias-e-book-boom-is-a-page-turner.html

 

Facebook for Moscow

5:19PM BST 04 May 2010 The online social network Facebook opened an office in Moscow this month, and entered talks with local mobile phone operators as part of a project to expand operations. “We have been talking about integrating operator … Continue reading →

Comstar CEO Sergei Pridantsev is optimistic about Russia’s communications market

Victor Kuzmin, Russia Now

11:46AM BST 07 May 2010

RN spoke to Sergei Pridantsev, CEO of Comstar, one of Russia’s leading communication companies, about the country’s prospects.

 

Comstar CEO Sergei Pridantsev - Russia NowComstar CEO Sergei Pridantsev

 

What changes has the Russian telecommunications market seen in the crisis?

The crisis has affected many industries in our country, and that includes communications. People have started trying to save money – and above all, on leisure activities outside the home. So what entertainments are there at home? The television, the internet and the phone. The growth in operators’ subscriber base and traffic volumes has confirmed this. For example, according to various agencies, the growth in the broadband Internet access market across Russia as a whole has been in the order of 30pc.

The Comstar company’s subscriber base grew by 41pc in 2009, to 1.3 million subscribers. There has also been a substantial increase in the number of subscribers to pay TV. According to sociologists, sales of television sets in Russia have fallen by just 5pc during the crisis. Some experts are expecting that as early as the second quarter of 2010 some purchasers will translate their plans to get a new television set into action. That means there will be more people buying in to our services.

The crisis has confirmed another axiom – that landline communications are an “anchor” service. In Russia, disconnecting the city telephone is the last thing subscribers do – up to now the landline service has been much cheaper than the mobile system.

 

source:http://www.telegraph.co.uk/sponsored/russianow/technology/7690899/Comstar-CEO-Sergei-Pridantsev-is-optimistic-about-Russias-communications-market.html

 

 

Tetris, the world’s best known computer game, was born in Russia

Friday 15 July 2011

 

This online supplement is produced and published by Rossiyskaya Gazeta (Russia), which takes sole responsibility for the content.

 

Google remembers the 25th anniversary of Tetris in 2009

Google remembers the 25th anniversary of Tetris in 2009

 

Valentin Maltsev, www.chaskor.ru

6:44PM BST 22 Jun 2010

The world’s best known computer game first appeared on June 6, 1984, the brainchild of a Russian programmer

If you ever worked with a computer, you know about Tetris. And even if you have never owned a computer, you have surely seen children playing this game on their Playstations or even their phones.

Tetris was released on June 6, 1984 and became an instant classic.

What makes the games unique is that it is still a popular pastime in spite of the plethora of digital entertainments that have appeared since its creation. Tetris was invented by a Soviet programmer, Alexei Pazhitnov, while he was working at the Academy of Sciences.

The Cold War was at its height, but it did not prevent Hank Rogers, an enterprising American businessman and owner of BulletProof Software, from buying the rights to the Russian game.

Since then, 120m official copies of the game have been sold. It may be hard to believe, but Tetris is among the 10 most popular games for the iPhone according to purchases in the AppStore. The Tetris licence is currently owned by Electronic Arts, but the licensed copies of the game sold for PCs, smart phones and pocket consoles do not begin to give an idea of the real number of pirated copies sold.

Yet Rogers is sure that the game still has untapped potential: He plans to include Tetris in the Olympic Games. The US Tetris championship will be held this year, he promises. Interestingly, Alexei Pazhitnov still receives royalties from Rogers for selling his game.

Pazhitnov himself insists that he did not invent Tetris as entertainment. His aim was to test the potential of Soviet computers. He wrote the game on the Elektronika-60 computer: “I tried to transfer the table games I used to play as a child to the computer. Tetris is one of the best children’s games that develop the mind,” he says.

He attributes the success of Tetris to the fact that “it is easy to learn, but hard to master”. He says the game is successful because it is the player’s task “to build, to create, and not to destroy”, making it a “feel-good game”. Pazhitnov’s other games, including Pandora’s Box and Hexic are less popular. In fact they are practically unknown.

Could a Soviet programmer imagine in 1984 that his brainchild would conquer the world? Certainly not. At the Soviet Academy of Sciences, the 29-year-old Pazhitnov studied artificial intelligence and created speech recognition programs. Tetris was intended not as a game, but a program demonstrating the potential of the computer intellect: the computer is so smart that it can even put building cubes together. The Soviet computer of the time failed the test.

Tetris is a truncated digital version of the Pentamino game popular in the Soviet era, in which all the figures consisted of five squares. Pazhitnov “simplified” the game because the computers of the time were not powerful enough to handle the classical Penatmino game.

During the course of many experiments, it occurred to Pazhitnov that the figures could be put together by a human and when they form themselves into a figure, the figure disappears and the game starts all over again. Tetris thus became a pastime that had grown out of a scientific experiment.

Later a 16-year-old Soviet schoolboy, Vadim Gerasimov, exported the game from Elektronika-60 to an IBM PC. Tetris quickly became popular among Muscovites before spreading to other countries in the Soviet camp and eventually caught the eye of Americans in Hungary.

The right to sell the game in the US was contested by the companies Spectrum Holobyte, BulletProof Software and Atari Games, Famicom and others. BulletProof won the contest. Foreign rights to Tetris are the subject of a very complicated story.

Legend has it that within two weeks, Tetris became a best seller among the then-small community of Moscow programmers. Officially, the rights to the program belonged to the Academy of Sciences Computer Centre. True, the Centre did not show any interest. Tetris first appeared in Hungary where it was taken up by the staff of the local Institute of Energy Studies in 1986. The game was transferred to Commodore and Apple-2 computers.

The owner of the British company Andromeda Software, Hungarian-born Robert Stein, happened to be at the institute at the time. Realising the game’s potential, Stein immediately contacted Pazhitnov and received his consent to sell the rights to the game. However, negotiations between Stein and the Soviet Computer Centre dragged on for weeks. Stein even paid a visit to Moscow in the winter of 1985, but the negotiations were not crowned with success.

In the meantime, Americans from the company Spectrum HoloByte heard of the existence of Tetris. They agreed with Stein that he would first buy the rights to the game from the Russians and then sell them to the Americans. Stein, realising that the talks with the Soviets were at a dead end, never admitted the failure of the talks, and Tetris began to be sold in the US illegally. The American PC version of the game was released in 1988.

Later on there were many negotiations, with the British, Stein and other companies. In 1989, Hank Rogers, then representing the interests of Nintendo, met Pazhitnov . Nintendo bought the rights to the game on March 21, 1989. The rights were then passed to the company Blue Lava Wireless, also owned by Rogers.

In 2005, Electronic Arts Company bought the rights to Tetris for $137m. Pazhitnov did not receive any royalties for his invention until 1996, although the game was selling millions of copies.

In 1988, Pazhitnov set up his own company, Anima Tek, to develop gaming software and he set up the company Tetris in 1991. It should be noted that Pazhitnov received substantial help in creating his own business from none other than Rogers, who became his partner and friend.

Five years later, Alexey Pazhitnov left to work for Microsoft where he created Pandora’s Box. Pazhitnov now works for the company Wildsnake Software, which develops and distributes casual computer games. In March 2007, he won the First Penguin Prize as part of Game Developers Choice for his services to the gaming community. Guinness World Records says Tetris has been exported to the largest number of devices and with the largest number of variants.

But here is the irony: ask a Moscow 10-year-old (or for that matter, an adult Frenchman) what country gave birth to Tetris, and it’s unlikely they will say Russia.

Today, all we can do is to congratulate Alexey Pazhitnov and his game Tetris.

 

source:http://www.telegraph.co.uk/sponsored/russianow/technology/7847705/Tetris-the-worlds-best-known-computer-game-was-born-in-Russia.html

Microsoft blankets NGOs and media in Russia with free licences

Friday 15 July 2011

 

Alexander Bratersky, The Moscow Times

10:56AM BST 29 Oct 2010

Microsoft has decided to legalise pirated software used by Russian independent media and NGOs in an effort to aid civil society.

 

Russia software facts

Microsoft will issue a “unilateral NGO software licence” that will run automatically until 2012 and cover “the software already installed on their PCs”, Microsoft’s senior vice president Brad Smith said on his blog.

The move will hopefully prevent NGOs from falling victim to “nefarious actions taken in the guise of anti-piracy enforcement”, Mr Smith wrote. “Now our information will fully exonerate any qualifying NGO, by showing that it has a valid licence.”

In 2012, Microsoft wants to move NGOs to its donation programme, infoDonor, because it helps organisations keep their software up to date. The temporary legalisation of pirated software stems from the fact that some NGOs in a number of countries, including Russia, are unaware of the programme or do not know how to navigate the process, which involves ordering donated software through a Microsoft partner, Mr Smith said.

Last year, the company donated $390m worth of software to 42,000 NGOs around the world.

Mr Smith’s statement came as a reaction to an article in the New York Times that said experts working on behalf of Microsoft had helped Russian law enforcement agencies provide copyright violation evidence in court against NGOs, effectively facilitating a government crackdown on dissent.

In one such case, the police accused Alexandra Denisova, an activist of the Ethnica NGO, of using illegal software at her company in Krasnodar in 2009. The case was brought after complaints by a legal anti-piracy expert and a regional Microsoft software distributor.

Police later dropped the charges after the court sent the case back to them for additional investigation in May of this year.

Ms Denisova could have been sentenced to up to six years in prison if convicted.

Microsoft said earlier that the use of illegal computer software in Russia remained rampant. It stated in June last year that it was losing more than $1bn every year because of Russian software piracy.

According to a Microsoft investigation in May, about 22pc of 3,000 randomly checked sales points in 53 Russian cities sold illegal software. The investigation was carried out by Microsoft employees posing as customers.

NGOs only account for a tiny proportion of software users, meaning that anti-piracy efforts will have to continue at full swing, said Alexei Maximov, editor of the Russian edition of PC Week.

 

Software piracy in decrease

In a 2010 report, Business Software Alliance said that despite the financial crisis the level of illegal software use fell across the world, including in Russia.

 

source:http://www.telegraph.co.uk/sponsored/russianow/technology/8095901/Microsoft-blankets-NGOs-and-media-in-Russia-with-free-licences.html

 

Russian oligarch Mikhail Fridman aims to build international mobile phone giant

Friday 15 July 2011

 

Mobile phones in shop - Russia NowMobile phone penetration in Russia has now topped 140pc, with more than 209 million SIM cards bought by a population of 143 million Photo: Alexandr Schemlyaev – PhotoXpress

 

Ben Aris, Business New Europe

1:44PM BST 02 Jun 2010

From window cleaner to one of Russia’s richest men, Alfa Group founder Mikhail Fridman has always set his sights high. And now it appears his telecoms dream may come true.

 

One of Russia's richest men, Alfa Group founder Mikhail FridmanOne of Russia’s richest men, Alfa Group founder Mikhail Fridman

 

Of the original oligarchs who rose to prominence under Boris Yeltsin, Alfa Group founder Fridman is one of only two still in the game. He set his heart on telecommunications early on, and in April he cleared away the last obstacle to fulfilling his dream: to create a “Vodafone of the East”.

“Fridman always made it clear that everything in the group was for sale – but not the phone business,” says a former Alfa Group executive (who didn’t want to be named) talking about the group’s strategy.

Alfa Group was originally supposed to be a member of Mustcom, the consortium put together by Vladimir Potanin (the other surviving Yeltsin-era oligarch), which included a 25pc stake in the state’s fixed-line operator Svyazinvest bought by international financier George Soros in 1996.

“We were pushed out by Potanin at the last minute,” Fridman told this correspondent in an earlier interview. (Fridman refused to be interviewed for this article.) It was years later that Fridman began to formulate his plan to lead the Russian telecom sector.

Fridman’s chubby figure and jolly demeanour is deceptive – in business he can be ruthless. And trouble has tended to follow in the wake of many of Alfa’s purchases in the telecom sector.

The empire expands

The jewel in the crown in the group’s telecom holdings is the stake in Russian mobile operator VimpelCom, which was set up in the early Nineties. With a sign-up fee of around £ 3,500 and usurious per-minute rates, it was profitable from day one; the company has since been a driving force in developing mobile telephony across Russia’s nine time zones.

However, one of the very first reforms that president Vladimir Putin made on taking office in 2000 was to completely remake the telecom sector and create a level playing field. The reforms went so smoothly that its success has got very little attention – a lot less attention than subsequent reforms to sectors such as oil and banks that have gone less well.

The upshot is that Russia’s telecom sector today doesn’t look much different from those of Russia’s western European peers. Growth of the sector has been quicker than most experts forecast: sim card penetration rate passed 100pc several years ago.

As the Russian market reaches maturity, the game is already starting to change, with the leading companies casting their eyes across borders to other emerging European markets that are still playing catch-up to Russia’s lead.

Fridman picked up a minority stake in Russia’s third-largest mobile phone operator MegaFon in another long-running corporate tussle, as well as doing a deal two years ago to acquire a stake in Turkey’s leading mobile company Turkcell. Alfa Group said in January that it wants to merge MegaFon and Turkcell into a holding company called Altimo, but Russia’s regulator is not happy with the idea.

Yevgeny Dumalkin, a spokesman for Altimo, told newswires in January: “The 
 potential of the telecommunications sector inside and outside of Russia is far from exhausted. In this regard, Altimo does not plan to part with its current assets in this sphere and will actually work to consolidate assets in the telecommunications sector.”

But it is VimpelCom that holds the greatest promise and will be the cornerstone of Fridman’s vision to build a mobile phone company covering the entire territory of the former Soviet Union and beyond.

Mobile telephony’s market share in Russia

 

Where next?

The merger – which featured a long-standing dispute between Altimo and Telenor, a Norwegian company that owned a 29.9pc stake in VimpelCom – marked one of the nastiest corporate battles in eastern Europe and did Russia’s image a lot of damage.

In the end, Fridman won out and both companies agreed to the creation of VimpelCom Ltd, combining his assets with VimpelCom and Kyivstar, a leading Ukranian mobile operator.

One of the first Russian companies to list abroad, VimpelCom is listed on the New York Stock Exchange.

So far, the new company has said little on what its next step will be, but the merger means the company is already the leading operator in the two biggest markets in eastern Europe with a combined population of 188m people – equivalent to a quarter of the entire European population.

“VimpelCom Ltd says it doesn’t have a strategy for now, but that it will be developed and announced in the summer,” says Victor Klimovich, a telecom analyst at VTB Capital in Moscow.

“The only hint given is that the [former] CEO, Alexander Izosimov, said in February the company will probably concentrate more on mergers than acquisitions.”

Fridman still has a clear field in most of the countries that the new company can expand into, but to really make the dream come true, Altimo will have to go up against the world’s largest companies at some point.

“There’s a rumour in the market that VimpelCom may bid for some of [the Middle East's mobile powerhouse] Orascom’s assets – one of the biggest emerging market operators with operations in Africa as well as Pakistan and Bangladesh,” says Mr Klimovich.

“It’s thought VimpelCom is interested in the latter, but Telenor already has strong positions in those two countries – so that could see a problem again.”

With the world’s economy in tatters, the future for telecom companies is now in the fast- growing economies of the emerging markets, and Fridman has already placed himself in a strong position to emerge as one of the leaders in the race.

 

source:http://www.telegraph.co.uk/sponsored/russianow/technology/7797655/Russian-oligarch-Mikhail-Fridman-aims-to-build-international-mobile-phone-giant.html