Interview of the Director of Enterprise Incubator Foundation (EIF) Bagrat Yengibaryan to Mediamax and Banks.am portal##

- Recently an agreement was signed on establishing an educational laboratory of SUN Microsystems in State Engineering University of Armenia. SUN is known as a corporation, which actively expands its production in various countries. Can Armenia become one of those countries?

- SUN Microsystems works in three directions: programming, production of computer components and in the course of the recent two years - production of super-computers. The corporation intends to carry out preliminary research in Armenia, after which it will make a decision on opening its production center here.

In three higher educational institutions of Armenia – Yerevan State University, the State Engineering University and the Slavonic University, there are already SUN educational laboratories opened or in the process of opening. At present, the issue of establishing SUN laboratory in the American University of Armenia and in Gyumri is in the process of discussion. Besides, in Enterprise Incubator Foundation a laboratory will be opened on programming and SUN attestation. The necessary equipment is already supplied to Armenia, and in the nearest months the laboratory will start functioning. All these measures aim at training high-quality personnel and assisting local companies.

- What IT-products are produced in Armenia today?

- Let me name a few local companies, which make IT-production of world importance: of great importance are the electronic control program packages of AIT Systems Company, the production of Sourcio Company in the sphere of electronic healthcare and monitoring of internet-environment, in the financial sphere NATC company is known as the author of EDRAM electronic payment system. In general, in the course of the recent three years, a number of Armenian IT Companies started paying serious attention to creating their own products. In the past, the main problem was the entry of those products to the market; however the establishment of representative offices of our Foundation in Austria and Canada became a serious stimulus for the export of Armenian IT-production.

Foreign IT-companies, functioning in Armenia, fulfill orders from abroad; however, if we take a careful look at their activity, we will see that they are involved in making products. One should note that a number of important products of the U.S. National Instruments are produced exactly in Armenia.

The export in the sphere of information technologies, if we do not take into account the foreign companies, exceeds $10mln. The total turnover of IT-sphere in Armenia, according to our calculations, already exceeds $200mln. The point is that it is very difficult to discern the border of what is made here and what is made abroad.

- Are there complete local software products in Armenia?

- There is such production in Armenia. This, in particular, is the production of Sourcio, NATC and AIT Systems companies. NATC production is used in Canada, AIT production in India and the USA, Sourcio - in the USA and Austria. Besides, there is also software production for the financial sphere, which is also fully made in Armenia and is used here. Here we talk not only about banking programs, but also the accounting ones. The problem is not the absence of IT-production, but the absence of assistance for Armenian companies in creating products. Besides, it is very difficult to sell the ready IT-production in Armenia.

- What is your assessment to the government activity in stimulating the IT-sphere of Armenia? It is well-known that Enterprise Incubator Foundation is carrying out a competition for the best business project in the IT-sphere. Would you, please, tell us about this project?

- The achievements of the IT-sphere in Armenia almost exclusively represent the achievements of the private sector. There is certain participation of the government, but it is not yet sufficient. The only and successful program of the government in the sphere of information technologies is the Enterprise Incubator Foundation, which, by the way, had serious influence on the development of the IT-sphere. In the course of the recent years, the government’s aspiration to understand what the aid of the state can be for the sphere is marked. One of the recent important steps is the conception of the government, as well as the fact that for the first time the budget of Armenia mentions the IT-sphere by a separate line. It is necessary to increase the cooperation between the state and the IT-sphere. The private sector very much needs state support.

By our business-programs, we try to stimulate cooperation between research groups and private enterprises. The research groups can offer technology solutions and ideas, and we try to assist for the private sector of accept them, which will undoubtedly lead to both the development of their business and the increase of efficiency. Unfortunately, between scientific-research groups and private companies, which do not belong to the IT sphere, there is no dialogue yet, and our goal is to encourage such cooperation.

- It is well-known that the penetration of information technologies in various branches of Armenian economy is quite weak. In which spheres can we already talk about achievements and in which spheres there is nothing done in this direction?

- On the whole, the use of information technologies in Armenia is at a very low level. The population of our country does not use computers for solving their day-to-day tasks. Ten percents of computerization is simply a shameful figure. The level of computer use is quite low in the Armenian government as well. Talking about “information technologies”, I do not mean the collection of files in the computer, but the use of solutions, which assist the increase of efficiency of the government activity.

- In Armenia, despite achievements of the sphere itself, information society is not yet formed. As to computer use, our country occupies the 106th place in the world. How can we solve this problem?

- It is necessary to actively use information technologies in the educational sphere: starting at the school level to the university one. Another important task is the implementation of “Computers for all” program, when at the mediation of the state there are conditions established, in which each citizen would gain the opportunity to purchase the use a computer. One of other important conditions is the implementation of IT in the management sphere, when services would be established, which would be provided only electronically, or completely electronic platforms, which would stimulate the formation of an information society.

- It is well-known that Enterprise Incubator Foundation also trains managers in the IT-sphere. What educational programs do you carry out at present?

- We regularly carry out short-term specialized courses with private enterprises, for instance, we teach programming languages, as well as carry out Project Management courses. Each month, we realize 1-2 courses. Besides, we cooperate with higher educational institutions, trying to contribute to the formation of specialties in IT-sphere.

- Do you have projects, related to Gyumri technopark?

- This technopark is at the planning stage. At present, there is a contest announced, following the results of which a foreign expert and a group of local specialists will be invited, who will have to present by the end of the year the business-program of the technopark and a distinct action plan. Till that, we try within the framework of Gyumri Center for Information Technologies to carry out a number of “pilot” programs on three-dimensional modeling and open a SUN laboratory there. Gyumri technopark has a number of other directions besides IT, but I believe that serious achievements will be marked by technopark in the very IT sphere.

- How do you assess the implementation of IT in the financial sphere?

- The use of IT in the financial sphere, as compared to the remaining spheres, is at a quite high level, but I have noticed that today many banks have their own IT-teams, while in the whole world such services are usually ordered from specialized enterprises. The fact that, looking over the vacancies of Armenian banks, we oftener see demand for specialists in IT-sphere, evidences that there are not many companies in the IT-sphere, which can provide banks with all the necessary services, and the banks, in their turn, realize that without the use of high technologies they cannot be competitive.

I believe that the given situation will improve gradually. Companies will appear, which will do that work for the banks more inexpensively and providing more quality, and the banks will not have to hire a staff of IT-specialists.

- What is your assessment of the cooperation between telecommunication and IT companies in Armenia? Don’t you think that the there is practically no interrelation between them?

- In many countries, telecommunication companies represent a serious stimulus for the development of the IT-sphere. Their gains on average are incomparably higher than the gains of many IT companies. At that, there is the task of developing the IT-sector set for telecommunication companies. They train IT-specialists, participate in national programs and many actions, directed on the development of the sector. In many countries, certain percentage of tax proceeds from the IT-sphere and the telecommunication sphere is directed to the development of IT. The companies pay taxes, the state directs them to the IT-sphere, and the latter gives new technologies and new growth opportunities to the companies. This practice is not used in Armenia, despite the fact that telecommunication companies of Armenia can also become a serious stimulus for the IT-sphere development. However, the state, and not the telecommunication company, should be the initiator of such programs.

- Can the broadband Hi Line internet, launched by Beeline, be considered as a stimulus for the IT-sphere?

- Hi Line launch is, of course, an important event, which makes internet available for wider layers of the society, but here it is important for Beeline not to abuse its monopoly positions. For the population it is a stimulus, and for IT companies it is not. Besides, being the most available broadband internet service in Armenia, this service still remains expensive. It is clear that here we have the problem of limited resource: there are only two companies – Fibernet and ArmenTel, which, roughly speaking, import internet to Armenia. Nevertheless, they should hold talks and cut down the tariffs for internet.