1. St.Petersburg, 16 June, 2005 The Russian Offshore Software and Product Development Industry Survey

2. Main objectives Preliminary results: - Estimations of export revenues 2004 - Main exporters - Geographical distribution of companies –Salaries –Branch Offices –Key trends of the market (as seen by CEOs) –Areas of expertise Contents:

3. To get up-to-date information about the industry, to consider its trends and the future To promote the Russian software development industry on international markets and to atract potential customers To extend the positive image of Russia as one of the major software outsourcing destinations and as a source of high-end solutions Objectives

4. On-line sells - through Internet (Digital River, SoftKey (Russia)). Estimations of export - $40Mio-$55Mio Off-line sells – through direct sells and distribution channels. Estimation of export - $70Mio-$100Mio. Main markets: USA (50%), EU (35%), Eastern Europe (10%), Asia (5%) Source – Independent Software Developers Forum (Dmitry Kourashov) Export market of software products

5. Geography

6. Average Annual Revenue

7. Market Growth Estimation 2004: $700mln Growth estimation by CEOs: 2005: 50% 2006: 45%

8. Average Max. and Min. Salaries ($) Average software development rate: $20 per hour

9. Branch Offices in Russian and CIS

10. Software Development Process Certification

11. Key Trends of the Russian Offshore Development Market (as seen by CEOs) Trends% of companies Market growth83.3 Industry consolidation (mergers/ acquisitions)75 Implementing western project management practices, ISO 9001 and CMM/CMMI certification 54.2 Increasing of service providing’s share37.5 Increasing of product development’s share25.5

12. Main Priorities of CEOs Priorities% of companies Company growth91.7 Clients acquisition through new markets entry70.8 Offering new software development services70.8 ISO and CMM/CMMI certification20.8 Implementing "product" model16.7

13. Areas of Expertise

14. Business Domains

15. Thanks! Contacts: Alexey Shonin – Editor-in-Chief, Outsourcing-Russia.com +7 (812) 327-9900 Editor@outsourcing-russia.com Vakentin Makarov – President, RUSSOFT +7 (812) 331-75-61 makarov@russoft.org Maria Simonova– Head of analytical department, Fort Ross +7 (812) 331-75-60 Maria.Simonova@fort-ross.ru