The News: International sanctions against Russia have incented, and in many cases, forced Russian companies to seek communications solutions outside of the standard list of leading providers, and many of those companies are choosing on-premises solutions as a hedge against further disruption in the supply chain underlying their ability to communicate and do business. Russian native video communication provider TrueConf is leading the pack of vendors rushing to fill the market gap left by the departure of the global leaders. More information on TrueConf and its offerings can be found on its website.
TrueConf is Taking Full Advantage of the Absence of Global Communications Providers in Russia
Analyst Take: As Russia prepared to invade Ukraine, the United States and other countries sanctioned the Russian government, businesses, and individuals. U.S.-based communications platform providers (Microsoft, Zoom, Cisco, and Google), among other companies, reduced or ended their investment in their Russian business because direct communications technology exports from the U.S. to Russia were now illegal. These sanctions, like any others, intended to place economic pressure on a regime to change course, which may well happen. That said,, the near-absence of the major global communications platform providers has created a gap in the market that is being filled by native Russian solutions.
Before the invasion, Microsoft Teams was the leading provider of UCaaS in Russia. After the sanctions were imposed, existing customers could no longer extend their contracts, and new contracts couldn’t be written with Microsoft or any of the other U.S.-based communications brands. There are certainly ways around this — a reseller in a non-sanctioned country that has maintained normal relations with Russia, for example. Still, these workarounds impose complexity and risk that many customers are unwilling to accept.
In response to these risks, many Russian companies started looking to native Russian options, and the Russian government has increased its investment in developing a native Russian tech sector. These actions have resulted in a boom in Russia-based video meeting products from companies like Yandex Telemost, SberJazz, Vk Calls, Videomost, iMind, and Trueconf.
The TrueConf Backstory
TrueConf was founded in 2010 and, from the beginning, has focused on the on-premises delivery of video meeting services. As cloud-based solutions grew exponentially, it seemed that on-premises meeting offerings were destined to exist as niche solutions. However, the shift in international relations has expanded that niche substantially. Not only are Russian customers interested in native solutions to minimize the risks presented by unstable international relations and war, but they are also increasingly interested in on-premises solutions for precisely the same reasons.
TrueConf has always had business outside of Russia, but they are noticing the same interest in de-risking communications systems, which is accelerating their international growth as well. As has been the case since the days of the spice routes, technology follows trade and TrueConf is seeing tremendous growth in many of Russia’s largest trading partner countries. While the global pandemic provided resources and incentives for the global market leaders to invest, the absence of those same leaders is allowing Russian video meeting providers to invest in their businesses and products.
TrueConf has recently enhanced its security capabilities and added AI-based noise suppression, auto-framing, virtual backgrounds, and more. None of that is entirely new to the market, but at this moment, that’s not the point. They are migrating clients from Teams, Webex, and Zoom, those clients are requesting features, and TrueConf is gaining market share by being very responsive to customer requests in these uncertain times.
What Happens When the World’s Relations with Russia Normalize?
The real question here is: What happens when the world’s relations with Russia normalize? It’s hard to predict when that will be, but it is becoming clear that the longer the Russian communications market is left to evolve without the influence of the leading, primarily U.S.-based solutions, the more formidable these Russian vendors will become. While the causes are different, the Russian market is similar to the Chinese market in this way. Chinese vendors are veiled from the outside world, and companies like Tencent and ByteDance are growing their base and capabilities, building strength for head-to-head competition with the brands we all talk about daily.
All too often, people talk about the communications market as if it were, or soon will be, an oligopoly and that the move to the cloud is inevitable, myself included. Microsoft, Zoom, Cisco, Google, and RingCentral own a massive portion of the global market. But there are new companies building strong products in countries that the western-technorati don’t think about all that much and using deployment models that many of those leaders have left behind. Circumstances, however tragic, are allowing these companies to gain traction, and when circumstances change, we can expect a reshuffling of market share to occur.
Disclosure: The Futurum Group is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of The Futurum Group as a whole.
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Author Information
Sean is a Senior Analyst strategically focused on cloud-based collaboration and its impact on worker productivity and human connection. Sean provides research on market sizing and forecasts, product and service evaluations, and end user/buyer insight.
Sean is a trusted advisor to and assists industry vendors and enterprises with workplace communications and collaboration strategies, market entry and product assessment, product portfolio analysis, and sales enablement services.
Prior to Wainhouse, now a part of The Futurum Group, Sean was the Chief Product Officer at PGI, owning the product strategy and roadmap for a full suite of B2B and B2B2C SaaS communications products including an enterprise grade phone system, audio meetings, video meetings, messaging, video webinars, high touch attended audio conferences and massively scaled video webcasts.
Sean holds a Bachelor of Science in International Business from University of Colorado, Boulder.
