High-Tech Russia

A cartoon from the 1990s depicted a Russian bogatyr (ancient warrior) on horseback, incredulously poking with his spear at a computer keyboard in front of Baba Yaga's (a witch-like Slavic folklore character's) log house. The keys on the keyboard were made out of tree stumps, cut to various sizes. A sign on the house proudly said, “The first ancient Russian computer.” Such may be the popular image of high-tech Russia. Could there be a real high-tech Russia—a Russia of cutting-edge technology, not of tree stumps? We need to remember that although Russia's recent history has been one of deconstruction and humiliation, it remains a country producing many sophisticated weapons and spacecraft, with millions of highly talented and well educated scientists and engineers. Nevertheless. the investments in high-tech enterprises have been lacking over much of the post-Soviet period. Investments in research and development (R&D) in Russia are trailing those in virtually all developed countries— not only in absolute amounts, but even in proportion to the GDP. The total spending in Russia on scientific research in the mid-2000s was 13% of the U.S. level, even with GDP adjusted for purchasing power parity. Russia at present has a hard time even holding on to the areas in which for a while it enjoyed a leading position in the world (e.g., laser development, nuclear physics, organic chemistry, microbiology, and mathematics).

The following high-technology industries, services, and research areas are nevertheless being developed in Russia: electronic hardware design; computer software design; telecommunications (cable and satellite TV and the Internet); avionics; geospatial technologies; “smart” weapons design; advanced biotechnology; genetic engineering and molecular biology; industrial chemistry and pharmaceuticals; new medical devices; and nanotechnology. Not all of these have a strong domestic innovative component, however. Although you can get a computed tomography (CT) scan in a Russian clinic now, until just a few years ago no CT machines were made in Russia; all were imported from Germany or the United States. Similarly, all personal computers (PCs) are either imported whole or assembled in Russia from parts made in Taiwan, Singapore, Malaysia, and increasingly China.

However, some areas are positively booming. Arguably the most noticeable is the proliferation of cell phones and wireless gadgets in just the past 5 years. With some of the lowest rates in the world, unlimited pay-as-you-go call plans, and at least three major companies vying for customers coast to coast, Russia is a cell phone buyer's market. Almost 20 years ago, fewer than half of Russia's households had even a land phone, and automated intercity dialing was not available in many areas of the country. Even for big-city residents, no call waiting, caller ID, or collect calling was available. How much has changed in just 15 years! Instead of investing in obsolete landlines, the newly founded private wireless companies provided everyone with cell phone coverage, no matter how remote the location, within 10 years. There are more registered cell phone users in Russia now than there are people (over 150 million and counting). Many customers keep multiple phones to get the best rate, depending on their exact calling locations. The coverage for the largest country in the world is steadily improving. I had better reception on my cell phone in the middle of the Altay Mountains 10 km from a nearby village than near the entrance to Yellowstone National Park within 3 km of Gardiner, Wyoming, in 2007. A phone call within Russia usually costs less than 10 U.S. cents per minute, and since 2007 all incoming calls have been free. There are no credit checks to get a cell phone in Russia, and prepaid minutes do not expire. Some areas remain poorly served; still, cell phone service is now expected and makes good money for its providers. The top two, MTS and Bee-Line, were in the 10th and 12th spots, respectively, on the Russia Top 100 list of companies in 2007. Each was worth about $20 billion—just below the largest oil and gas producers, and comfortably ahead of car manufacturers, retailers, and most banks.

More digital phone lines and fiber-optic connectors are being put in annually. Cross-country digital trunk phone lines now run from St. Petersburg to Khabarovsk and from Moscow to Novorossiysk. The telephone systems in 60 regional capitals have modern digital infrastructures, many using U.S.-manufactured equipment and software. In rural areas, however, the telephone services are still outdated, inadequate, and very low-density compared to Europe's.

Another important high-tech system developed in the late Soviet period was GLONASS satellite navigation. Currently there are plans to bring it back to full operation with a few satellite launches per year. This is one of only two alternatives to the U.S.-controlled global positioning system (GPS); the other one is the Galileo system, which is still being deployed by the EU. The regular GPS receivers available to Western consumers cannot use the GLONASS signal; a special receiver is required. Some GLONASS units are manufactured in Russia, mainly for the military market, but more and more are now available from Asian manufacturers. Russia is second only to the United States in the number of communication satellites in orbit: Besides GLONASS, Russia maintains dozens of TV, radio, telephone, and military satellites. In 2006, Kazakhstan became the second FSU country to launch its own satellite, KazSat 1, although it was built with Russia's involvement.

Russia lags far behind the West in robot and computer development. Massive mainframe computers were built in the Soviet Union for military and civilian use, but even then they were not quite as good as American or Japanese models. Production of computer equipment almost stopped with the launch of economic reforms. For years the U.S. Congress banned exports of sensitive computer technology to Russia. Many Soviet computers were essentially clones of existing IBM systems that were built with stolen blueprints, but some (e.g., the BESM-6) were original domestic creations rivaling their U.S. analogues. However, with the advent of PCs, Russia followed the rest of the world in adopting American computer technology for home and business use (mainly Windows, although Mac and Linux are both available). Importing Western PCs was a common early path to wealth for the Russian entrepreneurs of the 1990s. Much of Russia's civilian computer manufacturing today consists of assembling laptops and PCs from prefabricated parts, using screwdrivers.

The Internet is yet another infrastructure development that is growing in leaps and bounds in Eurasia (Warf, 2009). The Russian segment of the Internet (“Runet”) is adding millions of users per year, with the number of users nearly doubling every year for the past 7 years. The domain zone .ru had almost 138,000 registered domains (i.e., Websites) as of December 2009—behind France and Poland, but ahead of Sweden and Chile. The Baltic republics had about 15,000 domains registered per country, and there are a few thousand each in most other FSU republics. The Russian language is among the top 15 languages encountered on the World Wide Web, although not yet in the top 10. About 27% of the Russian population had online access in 2008 (38 million users), as compared to about 71% (35 million) of South Koreans or 57% (33 million) of Italians. There were 62 million users in the entire FSU in 2008. Internet access is about as common in Russia now as it is in Turkey or Brazil, but not nearly as common as in developed Asia or Europe. In addition to accessing the Internet from home or work, many people use Internet caf?s, which are available in all big and medium-sized cities (Warf, 2009). Many also now have Web-enabled cell phones or personal digital assistants. Broadband connections are growing fast; few Russian homes have cable TV, so these are mostly digital subscriber lines at present, though wireless broadband is available in Moscow and other big cities. Golden Wi-Fi in Moscow is one of the largest citywide Wi-Fi systems in the world. Early in 2008, the Russian Ministry of Information announced a new federal program that would make broadband affordable to all urban users (75% of the population) within the next few years. In a vast country such as Russia, connections across long distances are of ultimate importance, so the Internet penetration is expected to grow. Because of the central government's current tight control over TV and newspapers, the Internet is the source of the least censored information in Russia at present, and ideally it will remain so.

Where are high-tech services found in Russia? Primarily in the biggest cities, of course, especially in and near Moscow, St. Petersburg, Nizhniy Novgorod, Yekaterinburg, and other cities with populations over 1 million, heavy industry, good universities, and a decent social life. Novosibirsk in particular is the high-tech hub of Siberia; it has great universities, diverse companies, and excellent international connections via the airport and the railroad. Other Siberian cities with high-tech R&D presence include Omsk, Tomsk, Krasnoyarsk, and Irkutsk. There are also a few dozen small academic towns in Central Russia, the Urals, and Siberia where much high-tech development takes place.

Other FSU republics have various degrees of high-tech development. If Internet usage is taken as an indicator, Tajikistan is the least high-tech country, with merely 0.3% of the population having online access. Other low-usage countries are Turkmenistan (1%), Kyrgyzstan, and Armenia (5% each). Estonia tops the list of high-tech FSU nations, with 58% of its population using the Internet in 2007, followed by Belarus (56%), Latvia (47%), and Lithuania (30%). Rates for Estonia and Belarus are comparable to the U.K. level. The U.S. and Japanese rates were 69% in the same year.