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Russia Facing Internet Outages Due to Equipment Shortage

Russia Facing Internet Outages Due to Equipment Shortage

Russia’s RSPP Commission for Communications and IT, the country’s largest entrepreneurship union, has warned of imminent large-scale service Internet service outages due to the lack of available telecom equipment.

To raise awareness, the commission has compiled a document that reflects the practical challenges facing the industry in Russia at this time and also presents a set of proposals specifically crafted to alleviate them.

Russian media that have seen the document in question say that the warning is dire, as the commission highlights the reserves of telecom operator equipment will only last for another six months.

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With the western equipment suppliers exiting the market and not selling parts to Russian entities anymore, the first notable service outages may start as early as this summer.

Additionally, the price of equipment still available for purchase has risen by 40%, and if the ruble continues to depreciate, the economic complications for service providers will get even more severe.

“Capital expenditures of the largest telecom operators will grow from 390 billion rubles, in 2021 to 450 billion rubles, in 2022, even with the reduction of investment programs.” the commission stated.

To address the problems or at least mitigate their effects, RSPP has proposed the following measures to be submitted to the Russian Ministry of Digital Development:

  • Impose a moratorium on contributions to the universal communication services fund for 2022
  • Reduce fees for radio frequency spectrum by 50%
  • Zero out the property tax rate and exempt the income of industry employees from taxes

However, Kommersant reports that it’s unlikely the ministry will take any radical action to address the issues raised by the IT union, which includes MTS, MegaFon, VimpelCom, ER-Telecom, GS Group, and the Russian Railways.

According to the same source, the ministry has unofficially rejected the concerns saying that success and good business performance aren’t the result of state support but good decision-making from the companies themselves.

A mass exodus of IT experts

Another big headache for IT firms in Russia is the manifestation of a mass exodus of skilled personnel fleeing the country in herds.

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This matter was first brought to light by Natalya Kasperskaya, co-founder and former CEO of Kaspersky, who stated that the outflow of IT specialists has been quite massive since the end of February.

Last week, Yevgeny Prigozhin, the owner of a large internet research agency, openly called the government to do something to stop the bleed of talent to foreign countries by imposing fines and travel restrictions on those who quit their jobs without a good reason.

Although fleeing young Russians have reported being interrogated at the airports, the Ministry of Digital Development flatly rejected the possibility of developing plans to hinder people’s movement to foreign companies.

Instead, the state underlined the need for decent and competitive working conditions to make the Russian job market more inviting to natives and foreigners alike.

The RSPP document touches on this subject again, warning that the industry may lose up to 30% of all highly qualified specialists in the following months, leading to a general deterioration through the degradation of the provided services and its impact on all sectors.

According to the latest data provided by the Russian Association for Electronic Communications, between 50,000 and 70,000 IT experts have already left the country, and another 100,000 may do the same by April.



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