Import Substitution: Mandatory Regulation or New Opportunity?

Import substitution in IT has reached a new stage in its development. 2018 did not become a turning point for Russian software manufacturers, but in 2019 a significant positive shift occurred in terms of domestic solutions.  Import substitution stopped being purely a mandatory regulation; now the market sees domestic software products as a new opportunity with specific technical and commercial advantages. These are the findings of studies carried out by TAdviser analysts. In June 2020, the leading Russian media portal defined the main achievements of import substitution in IT and published the first ranking, by revenue, of companies implementing solutions from the domestic software register. 

Meanwhile, in spring 2020, the Ministry of Energy’s Competence Center for Technological Development of Fuel and Energy identified 11 priorities for software import substitution in the oil and gas industry. The list is compiled based on an integral indicator, including criteria such as the availability of analogues, the volume of purchases, the share of foreign software, and the results of consultations with end users of these products.   

The ITPS group of companies became one of the participants in the TAdviser rating, taking the 6^th position and showing growth dynamics of 113.1% as compared to 2018. The result was achieved due to the successful implementation of major projects in which the products of Russian manufacturers 1C, RFD and ITPS and the key development of ITPS – AVIST Oil & Gas platform were used. The platform is included in the unified register of the Ministry of Telecom and Mass Communications of Russia, order of 28.04.2017 No. 212, registration number 98452. The functionality of AVIST Oil&Gas corresponds to the priority area “Software platform for production management based on integrated modeling of the technological system “reservoir-well-gathering system-reservoir pressure maintenance system” on the list of the Ministry of Energy Competence Center for Technological Development of Fuel and Energy.

The AVIST Oil&Gas platform is an umbrella for a comprehensive Intelligent Field industry solution, implementing an innovative approach to organizing development and production management in the oil and gas industry. The platform integrates production data streams and digital models which previously existed in different systems, separately from each other. It advises the operator on the optimal scenario for the exploitation of oil and gas fields.  It offers the ability to realize hidden potentials and avoid planning errors. Within the framework of the platform, a complete list of necessary digital tools has been implemented. This includes integrated modeling, capacity management, integrated planning, analytics, and real-time forecasts. In a situation where a complex solution is designed and implemented as a single integrated complex, business processes and structure are transformed. The effects of implementation increase significantly due to the optimization of all interconnected elements of the production chain.

“Today our portfolio consists of a balanced package of vendor solutions and our own developments included in the domestic software register. The import substitution policy changes the demand for foreign products and affects the requirements for domestic products. This evolution is a completely natural process. The market is changing, and we are changing together with it. This is a new level of development and new opportunities for us,” stated Leonid Tikhomirov, CEO of the ITPS Group of Companies.  

The Ministry of Energy states that with the application of best practices for the development and implementation of digital technologies, by 2035 it is expected that exploration and production costs by 10-15% can be reduced for comparable categories of reserves. This will also reduce the time for commissioning of new major projects by up to 40%. A road map will soon be developed for state support of a digital transformation in the oil and gas industry, considering the implementation of eleven priorities of software import substitution in the industry.