Russia and the information revolution

140 Pages·2005·0.489 MB·English

by  D. J. Peterson

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Russia and the
Information Revolution
D. J. Peterson
Prepared for Carnegie Corporation of New York
Approved for public release; distribution unlimited
The research described in this report was sponsored primarily by a grant
from the Carnegie Corporation of New York and was conducted under
the auspices of International Programs within the RAND National
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Library of Congress Cataloging-in-Publication Data
Peterson, D. J.
Russia and the information revolution / D.J. Peterson.
p. cm.
“MG-422.”
Includes bibliographical references.
ISBN 0-8330-3858-3 (pbk. : alk. paper)
1. Information society—Russia (Federation) 2. Information technology—Social
aspects—Russia (Federation) 3. Information technology—Economic aspects—Russia
(Federation) 4. Information technology—Political aspects—Russia (Federation)
I. Title.
HC340.12.Z9I555 2005
303.48'330947—dc22
2005026168
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Preface
This report examines the sources, dynamics, and consequences of Russia’s increasing
reliance on information and communications technologies to improve the transpar-
ency and performance of its government institutions, to reform industry and stimu-
late economic growth, and to improve access to information and the quality of life
for Russian citizens.
The objective of this study, which was conducted between 1999 and 2005, is to
understand how some of the momentous global trends in the 21st century will im-
pact Russia. This research effort seeks to bring to light emerging opportunities and
challenges facing Russia’s domestic development as well as its international posture.
This study should serve to assist decisionmakers in government, business, and non-
governmental institutions in Russia and internationally to make more-informed
choices regarding technology investment, management, and policy in Russia.
This report builds on a number of RAND Corporation studies of the impact of
the Information Revolution around the world:
• Richard O. Hundley, Robert H. Anderson, Tora K. Bikson, and C. Richard
Neu, The Global Course of the Information Revolution: Recurring Themes and Re-
gional Variations, MR-1680-NIC, 2003, available at http://www.rand.org/
publications/MR/MR1680/.
• Nina Hachigian and Lily Wu, The Information Revolution in Asia, MR-1719-
NIC, 2003, available at http://www.rand.org/publications/MR/MR1719/.
• Grey E. Burkhart and Susan Older, The Information Revolution in the Middle
East and North Africa, MR-1653-NIC, 2003, available at http://www.rand.org/
publications/MR/MR1653/.
• Michael S. Chase, and James C. Mulvenon, You've Got Dissent! Chinese Dissi-
dent Use of the Internet and Beijing's Counter-Strategies, MR-1543, 2002, avail-
able at http://www.rand.org/publications/MR/MR1543/.
• Christopher R. Kedzie, Communication and Democracy: Coincident Revolutions
and the Emergent Dictator's Dilemma, RGSD-127, 1997, available at http://
www.rand.org/publications/RGSD/RGSD127/.
iii
iv Russia and the Information Revolution
Major funding for this project was provided by the International Peace and
Security Program of the Carnegie Corporation of New York under Grant Number
B-7562.
This research project was conducted under the auspices of International Pro-
grams within the RAND National Security Research Division (NSRD). Interna-
tional Programs conducts research on regionally and internationally focused topics
for a wide range of U.S. as well as international clients, including governments,
foundations, and corporations. NSRD conducts research and analysis for the Office
of the Secretary of Defense, the Joint Staff, the Unified Commands, the defense
agencies, the Department of the Navy, the Marine Corps, the U.S. Coast Guard, the
U.S. Intelligence Community, allied foreign governments, and foundations.
For more information on RAND's International Programs, contact the Direc-
tor, Susan Everingham, by e-mail at [email protected]; by phone at 310-
393-0411, extension 7654; or by mail at the RAND Corporation, 1776 Main Street,
Santa Monica, CA 90407-2138. For questions or comments about this report, con-
tact the author, D. J. Peterson, at [email protected]. More information about RAND is
available at www.rand.org.
Contents
Preface........................................................................................iii
Figures........................................................................................vii
Tables.........................................................................................ix
Summary......................................................................................xi
Acknowledgments..........................................................................xvii
Acronyms....................................................................................xix
CHAPTER ONE
Introduction...................................................................................1
Study Objective................................................................................3
Organization of This Report...................................................................5
CHAPTER TWO
The IT Sector..................................................................................7
Telecommunications...........................................................................8
Hardware.......................................................................................9
Packaged Software...........................................................................10
IT Integration and Support Services.........................................................12
Technology Development...................................................................13
Offshore Programming and R&D...........................................................15
Challenges for Russia’s IT Industry in the Global Marketplace.............................19
Challenges of Russia’s IT Policy Environment..............................................24
IT Policy Initiatives..........................................................................27
CHAPTER THREE
IT in Business and Industry.................................................................33
Use of IT for Business Development and E-Commerce.....................................36
Use of IT for Managing Operations and Boosting Productivity ............................41
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vi Russia and the Information Revolution
Use of IT for Corporate Management and Governance.....................................43
Motivations for IT Integration............................................................43
Challenges of IT Integration ..............................................................45
CHAPTER FOUR
IT in Government...........................................................................49
Government Embraces IT...................................................................49
IT Initiatives and Impacts ...................................................................54
Back-Office Operations ...................................................................54
Front-Office Operations...................................................................56
A Long Way to Go...........................................................................59
Information Hoarding and Secrecy........................................................59
Unresponsiveness..........................................................................61
Corrupt Practices..........................................................................63
Lack of Coordination......................................................................65
Lack of Strategy and Leadership...........................................................66
CHAPTER FIVE
IT in Society.................................................................................69
Russians Get Online.........................................................................69
Digital Divides...............................................................................73
How Citizens Use the Internet ..............................................................75
The Internet and Civil Society Development ...............................................80
Political Activity on the Internet.............................................................84
Constraints on Internet Activity.............................................................87
Internet Policy...............................................................................89
CHAPTER SIX
Key Findings and Prospects for the Future.................................................95
The IT Sector................................................................................95
IT in Business................................................................................97
IT in Government...........................................................................98
IT in Society................................................................................100
APPENDIX
Discussion Participants ....................................................................103
Bibliography................................................................................113
Figures
2.1. Russian Software Exports...........................................................17
2.2. Value of Offshore IT Business Processes and Services Market, Russia and Six
Other Countries, 2003..............................................................20
2.3. International Human Resource Managers’ Criteria for Hiring College Graduates,
2003.................................................................................23
3.1. Purchases of IT Goods and Services by Business and Industry, Dollar Value,
2002–2004..........................................................................34
3.2. Proportion of IT Goods and Services Purchased by Business and Industry in
Russia, 2004 ........................................................................35
3.3. Proportion of IT Goods and Services Purchased Worldwide, 2004................36
4.1. Nonclassified IT Spending by the Federal Government, 2001–2005..............53
4.2. Government Spending on IT as a Share of the Gross Domestic Product..........53
5.1. Growth of Russia's Adult Internet Audience, 2002–2005 .........................70
5.2. Frequency of Internet Activity by Russian Adults, Winter 2004–2005............71
5.3. Geographic Origin of RuNet Traffic, 2004........................................74
5.4. Internet Audience by Nation.......................................................76
vii