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From Russia with Code

Future sanctions may make it difficult for Western software companies to do business in Mother Russia. But the country has a vast domestic software, services and internet industry of its own. These are some of the powerhouses.

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The Russian software and technology industry

According to figures released by IDC in the beginning of 2013, the Russian IT industry was valued at $36 billion. This includes $24 billion in sales of computer equipment, $7 billion in IT services and approximately $5 billion generated in software sales, of which over $4 billion is in exported software.

Regardless of what the future holds for the West's relationship with Russia, the country has its own domestic consumption for software and services with their own unique brands that in many cases mirror the capabilities of the companies we quickly recognize in the United States and in other Western countries.

You may have never heard of them, but they are software, services and Internet giants in their own right.

Here are just a few which will likely remain Russian powerhouses if the country becomes politically and economically isolated from the rest of the world.

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EPAM Systems, Inc.

Founded in 1993, just after the fall of the Soviet Union, EPAM (NYSE:EPAM) is by far Russia's largest systems integration firm.  The company has over 9000 employees worldwide and has service delivery capabilities in twelve countries. Their client list spans major brands and corporations across the Fortune 100. 

EPAM, like other systems integrators and software development firms on this list derives a lot of its revenue from doing outsourced work for other technology firms. But if it were to become isolated due to sanctions it would be Russia's strongest internal software development player.

The company's competencies include software product engineering and custom development, project-based technology consulting, Application testing, Maintenance and Support as well as Application Migration and Engineering. Their industry focus areas are ISVs, Banking & Financial Services, Business Information & Media, Travel & Consumer and Vertical Markets.

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Reksoft

Like EPAM, St. Petersburg-based Reksoft is one of Russia's most long-established boutique software engineering firms and is considered one of the country's highest growth companies in the technology sector. Their area of expertise covers desktop, web, cloud and mobile platforms, with a specialization in enterprise portals, unified communications, enterprise contact management and business intelligence.

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VK

Russia already has its own clone of Facebook in the form of VK, previously known as VKontakte, which has over 239 million accounts and over 100 million active users and is the 8th most popular social networking site in the world. Yearly revenue is estimated to be over $160M.

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Kaspersky Lab

With revenues of over $628 million, Kaspersky Lab is a multinational computer security company with over 30 regional offices, operates in over 200 countries and is headquartered in Moscow. It is considered one of the strongest players in the consumer and enterprise antivirus and antimalware space, and its products continue to score high on threat recognition tests performed by many computer industry publications.

Their malware research labs are considered to be among the best in the world. In 2012 the company was the first to identify the malware "Flame" which a researcher described as potentially "the most sophisticated cyber-weapon yet unleashed."

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AURIGA

Like Reksoft, AURIGA is a small but specialized IT outsourcing firm whose client list spans the Fortune 500 and is considered to be one of the best engineering outsourcing companies worldwide. Its expertise is in software research and development and has a large concentration in embedded systems, Linux and mobile technologies as well as web services.

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Yandex

Operating the largest search engine in Russia with about 60 percent market share, and with annual revenues over $900 million, Yandex (NASDAQ:YNDX) is one of the country's largest providers of internet-based services and products, including webmail, cloud storage, maps, news, video search, music, photo sharing, blogging, business social networking, electronic payments and text-based advertising on web-based and mobile platforms.

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Mail.ru

London-traded Mail.Ru started out in 1998 as a webmail service but it has become a highly diversified internet services company, with annual revenues over $680 million. As of 2013 according to ComScore, their websites reach approximately 86 percent of Russian internet users on a monthly basis.

While not as diversified as Yandex, Mail.Ru offers an email and personal content portal, socical networking, instant messaging, online gaming, search, e-commerce and integrated communications and entertainment in the form of My.com.

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Utkonos

With $500 million in annual revenue Utkonos started in 2000 as a catalog order company for over 200 boutique retail stores where customers could place orders in a brick and mortar setting. But it has now gone completely Internet order-based. It has over 40,000 square meters of warehouse space, 5000 employees and a huge fleet of delivery vehicles, all emblazoned with its friendly platapus cartoon character on its logo.

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OZON.RU

Ozon.ru is a near clone of Amazon, complete with bookstore and categorized product delivery services. Similar to Utkonos, and considered the country's largest e-commerce business, the company's revenues are estimated at $500 million and has over 14.5 million users. The company has a staff of about 2,000 and differentiates itself from Utkonos' delivery vehicle approach with over 2,100 pick-up points in over 130 cites, which allows it to ship goods to over 75 percent of the Russian population. 80 percent of its sales are paid cash on delivery.

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