How Russian customers of Western IT equipment prepare for potential sanctions

How Russian customers of Western IT equipment prepare for potential sanctions
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By East West Digital News in Moscow February 7, 2022

As Western powers could restrict supplies of IT equipment and support as part of potential sanctions against Russia, Sber is preparing for all scenarios. Last week, as reported by Kommersant, the state-controlled financial giant conducted technical exercises simulating the interruption of technical support from Microsoft, Nvidia, SAP, VMware and other companies, reports East-West Digital News (EWDN).

In a bid to gain more autonomy from international suppliers, Sber is also intending to purchase servers and data storage systems on a large scale, the business daily heard from unnamed sources.

Sber already showed interest in making its IT infrastructure less dependent upon US companies last year. In October, the bank’s top managers reportedly held a meeting with the heads of Russian electronics providers and IT integrators, reported Kommersant. They discussed a potential switch to Russian computing technology. Particular attention was paid to processors involved in AI operations.

Sber has developed one of Russia’s most powerful indigenous supercomputers, Christofari, which runs on Nvidia equipment. According to Kommersant, Sber considers dealing with Module, a Russian provider of processor cores, as a potential supplier.

Sber and other potentially concerned Russian companies declined to comment on the matter.

Mitigating risks

The authorities are also concerned about possible sanctions in the technology field. They are currently working out possible scenarios should supplies of microelectronics to Russia be restricted or Russian companies lose access to support services from foreign suppliers.

“Due to the deterioration of the international situation, we’re no longer just talking about the need for import substitution, but about how much time remains for this,” emphasised Renat Lashin, executive director at the ‘Domestic Soft’ association. The related risks can be mitigated by testing the infrastructure, conducting exercises, checking response scenarios and creating backup mechanisms based on domestic equipment, he told Kommersant.

While many foreign software solutions now have a domestic analogue, “the transition will be brutal and problematic for organisations that have not yet started replacing foreign solutions,” Irina Zinovkina, consulting director at InfoWatch, said to Kommersant.

In particular, she explained, data transfer will be required when replacing systems and this will inevitably affect business processes.

Alexey Smirnov, another industry insider, believes Western suppliers themselves will lobby against sanctions. “SAP, Oracle and alike have a pretty large number of customers in Russia in both the private and public sectors. Leaving Russia will be a substantial loss for them,” he told Kommersant.  

This article first appeared in East-West Digital News (EWDN), a bne IntelliNews partner publication.