Hi Andrey! Hello! I travell around the world and many hosting companies are asking how are the things going on in Russia? Meaning, they need some numbers, even for the sake of curiosity, some rules and speaking in general, they see Russia like “bears, vodka” — traditionally, and “balalaikas”, yes. And I wanted to ask you, firstly, some domain numbers in Russia. As you are the #1 registrar in Russia, you could tell some approximate numbers, besides you are a regular speaker in Russia, so these numbers are easy for you to say. In Russia, there are 2 national domains, this is the .ru Latin domain and .рф Cyrillic. For .ru there are about 5M at the moment, a little more than 5M domains, For .рф in IDN. The world’s largest IDN domain, about 800K. If we talk about the administrators, or the end users, exists about 2M people who register domains in .ru and .рф. If you look at the Russian market, is it still growing? Roughly speaking, the growth in the Baltic countries has stopped, the Russian market seems to be growing well every year. The Russian market grew quite well every year until last year, ish 2 factors had a significant impact on the market. 1 — the global economic situation, which led to a slowdown in the market, 2 — interesting case, last summer , the regulator of national zones increased the cost price of registration by 70%, to 150₽, This is about $2, the cost price of the domain in the registry for the registrar. This led to the fact that the .ru zone has decreased by approximately 400k domains, and the dumping occurred in the first place within the domainers, because the cost of maintaining the portfolio has increased. This did not affect Ru-Center retail customers in any way, for example, Reg.Ru , the second largest company in Russia, raised the price for symbolic 9₽. If to compare with Europe, the price tag in Russia is quite adequate. Moreover, it is still one of the cheapest zones in the world, $2 in the registry, versus $8 for .com. This may be a slightly stupid question, obvious to us, but for people outside it’s not, Russians, and by the way I can say it 100% of them, even when serving them abroad, Russians or Russian-speaking people require support in Russian It is true, it is true. In Russia, only about 4% of people have Travell passports, and have the ability to travell abroad. Accordingly, even less travells, therefore the main language is of course is Russian and this in many ways of course determines the success of the IDN domain in Cyrillic. Then, in Russia, there is a rule that hosting company should be based in Russia, of course it is a little bit different because of personal data, but in fact, hosting should be located in Russia. And I just wanted to ask, how often is it the case, that websites are blocked, because hosting is located not in Russia? Let’s just look not at LinkedIn, but at small to medium businesses. Last year, some laws ware adopted, that are aimed at storing personal data of Russian citizens in the territory of Russia. Similar occurs in Europe with a GDPR, i.e. the state is concerned about personal data. First of all, now the controlling body in Russia, Roskomnadzor, works with large companies like Google, Facebook, Microsoft, LinkedIn concerning storage of personal data. The law obliges all companies that collect personal data to store it in Russia. In fact, as before, it seems to me that a substantial part of the market, does not fulfill the requirement of the law, however, government have not yet got there, due to large numbers. Already, people are concerned about this law, i.e. it is not a law that can be neglected and people are concerned about this law and they are trying to do something. Yes, and in fact, we see a trend of transition from foreign hosting companies to Russia. Are these both shared hosting, vps and big providers? Yes, yes, yes. The big ones are transferred primarily due to the law about personal data, and small ones, not only because of personal data, but also because of the exchange rate difference between ₽ and $. Foreign hosting is becoming more expensive, i.e. if in Russia the price does not change in ₽, the price in $ in terms of ₽ increases. Plus, it is not yet predictable. If in €, maybe now it is affordable, but noone knows what will happen tomorrow. Yes. Then, I would like to ask you about payments in Russia Russia is a pretty
unique country where in fact a lot of payments happen and even a lot of local payments. People mostly pay cash for services Webmoney and bank transfers,
Yandex.Money, what major systems are used? If we talk about our industry. i.e. sales of digital services you need to look at 2 segments: individuals and legal entities of companies. Companies people often pay with
Bank transactions, individuals — in the Internet, in the last years,
the vast majority of payments is made with the cards.
Those plastic cards are not Visa Gold, these are, like, simple plastic cards. Any. All aggregators allow to pay via Yandex.Money. Yes, almost all sites work via aggregators that represent a whole list of possible payment methods, and then the site itself decides what to use depending on the commission that this site holds. Qiwi, WebMoney, — you even, as I understood, you accept the cash? Yes, yes, we have a client office physically where you can come to extend
domain name. revenue ~1 million ₽ a month, we get cash in the office Regarding the large hosting providers like Hosting Europe, GoDaddy, i.e. not necessarily them but such big hostings they come to Russia, how are they, are they doing well? OVH, Amazon, Google roughly speaking, with Shared Hosting, or very close to it, come to you? Are they successful here or ..? Four years ago, one of the biggest risks to our company was the possibility of major foreign players appearing here and we looked first of all at GoDaddy, they opened a regional office, but after that, by virtue of geopolitical changes due to
the emergence of laws, the parish state Internet, almost all foreign companies activity in the Russian market boiled down to zero, and for us this is, in general, probably good. And plus, there is a thing about papers in Russia, that is, roughly speaking, if GoDaddy sold the domain in America, and forgot about it, or through Cyprus, maybe even the receipt was not written out there I am not sure about the laws there, then in Russia we need paper invoice. Yes, yes. Russian legislation implies a decent amount of papers and control over money. Just to scare a little, roughly speaking, each payment must have some paper invoice and must have some act of acceptance, which has a physical signature. Yes, in general, yes, after signing any kind of agreement then there must be an invoice and payment of taxes following it. I also wanted to ask about external different website builders, for example Wix, Weebly, as far as I know a few years ago they were quite actively advertised, and now They faded in Russia. Yes, Wix bought back huge amount of television
advertisements and many people heard about Wix existance, and website builders in general. In recent years absolute silence, at least in the media, whilst in Russia there are some individual players who are successfully
advertising online. Landing pages, well, mostly some one-page website creation And I wanted to ask you about your uniqueness, for example, like a little bit of PR for you, technically, maybe you have any innovations, or know-hows, for example, specifically in your hosting company? Ru-center occupies about 37% of the market in terms of the number of domains and domains are probably the key for us. This year in April, we completely re-newed our website and among the other things appeared recommendatory system, I am not afraid to say, unique in the world such system does not exist. We have seen a similar patent described by GoDaddy, but it never came to implementation The key point of the system is that we offer to each client based on his portfolio of existing domains that we have, based on his behaviour, interest in one or another services, we recommend domains that allow him to protect his brand: reformulations, synonyms or suggesting interesting options in new domain zones or offer some services that he needs. At this moment ~10% of all
sales accounted for the recommendation system. I also wanted to ask a little about speed in Russia. If you take America, then in America actually, the distances are very long, i.e. from New York to Los Angeles the Ping run is huge. In Russia, the territory is not smaller, roughly speaking, but to compare Ping to to Baikal, it takes about 12ms, and I wanted to ask how it is with hosting it is somehow connected, or how? You have in St. Petersburg main office, right? or in Moscow? — In Moscow. And data centers? Data centers: Moscow, St. Petersburg, Novosibirsk. Novosibirsk, roughly speaking, is the heart of Russia. A person can choose where to park his website. Of course, by virtue of, physics from Moscow to Vladivostok, everything will take a long time, but here I must pay tribute to the state company Rostelecom in the last seven years they have invested heavily in infrastructure construction. data center channels, Red of course significantly increase accessibility, firstly the internet speed throughout the country, secondly quality. And if so to take globally, if American player comes to Europe, he takes the server there, often , it will be the Netherlands or Germany, i.e. somehow the conditions are good there, the prices are good, the connection is good and he needs 2 place, that is, de facto if he wants to go to Russia or to the CIS countries, it is clear that Kazakhstan has its own rules, Belarus has its own, while Ukraine can its own rules, it must have a place now in Russia. If earlier, for example, before any particular laws, five years ago he could have a point only in the Netherlands and there is a good Ping to Moscow, but it doesn’t matter, but now he should have one in the Netherlands and preferably in Moscow or in St. Petersburg. It is necessary to split
servers in Moscow and St. Petersburg, if talking about the implementation of legislation on the storage of personal data, but this is a need in general, only for the businesses that store this personal data the servers themselves, on which the business logic itself is located, they may well stay there too. And the speed from Germany is enough. Ping from Moscow to Novosibirsk, there’s a direct channel between Moscow and Novosibirsk, 10-12ms. In general, from Moscow availability to European sites is very good. And also, since we also buy a little servers in Russia and once bought other services in Russia and I speak about GDPR, “Guys, please delete my account, because I have deleted my account and still receive the newsletters” but they “spit” at me. I say “Guys, delete my email totally so that it is not there”, They say “Yes, we did”, and a month later I again receive the next letter. I say, “Guys, I have a right, as a European, to completely erase information about me.” They replied to me that they had erased it and in a month I again received a newsletter from them. I wanted to ask, as in Russia, any hosting company, still sells a little to the West and how do they look at GDPR? GDPR was discussed madly during last year. As of May 25th it came into force and penalties, but still there are no cases. All major companies, air companies, such as Aeroflot, in which a huge amount of foreigners flies, large hosters, i.e. Ru-Center, Reg.ru, all worried about GDPR, and de facto we meet the requirements, which they impose on us, but in fact the whole market is waiting for the appearance of some first cases on it, to understand how seriously, it bites what are KPI’s and for what they bite. I wanted to ask you about promotions if you go to the news section on your website but you have a marketing and remarketing department and you have a lot of traffic there, your company is big and there is a lot of segmentation, I wanted, people are watching you from Brazil, from Japan and, they (You can also see what they did in Japan) Maybe you can share one or two promotions that are the most remembered, or which gave the biggest KPIs, maybe the coolest ones, maybe you did something and it banged! Yesterday, I have heard, the Belarusians have launched an airship there and received great feedback maybe not in the form of registrations, but in the form there .. I am trying to think of… It comes to my mind one story, very successful, but I am forbidden to repeat it We had in one day 2 mailings going on to large user segments and we mixed up one was about the need to
verify email, otherwise the domain may be removed, and the second was advertising, and offered the service hiding contact information in WhoIs and in these newsletters we mixed up Subjects. In the end, it was a day with the best sales of hiding personal data, because it turned out a letter with about following content “if you do not buy this service, your domain may be deleted” This is a business in Russian way 🙂 Joke! actually not. Very good results all the time come after some big regional conferences. There is a Russian Internet forum, it happens every spring, there is always a surge, but usually, the price offers, the more aggressive they are, the the better they work. In our case, for example, the most what woks out, is scaring users, not in the sense that there will be something bad, but in the sense that some law comes out and you say that “guys, you simply will not comply with this law” They do not understand anything, they heard something about this law, and understood that they do not comply and immediately it somehow motivates them. A very good case was around just the personal data law, we have a CMS hosting and there is a big amount of websites, where is a feedback collection form, you must enter an email telephone and last names so it falls under the law about personal data, and here the user must explicitly
tick that he agrees and to read some documents,
personal data storage rules and etc. we have offered to our customers a
ready made set, sample rule set and very simple
technical possibility to tick and it did not affect our sales, but there were reviews like “Thank you very much that you figured out everything and did everything for us, we are happy and we can continue doing our business, but not such strange things.” By the way I noticed you have there
all sorts of apps like 2Gis and others but for some reason they still do not hide emails I do not know for sure. So you can still find a website, programme a robot, and parse from the Internet from any, or from many catalogues, I think, even from Avito You can contact them and download contacts. Avito hides the phone number. We, I can honestly say, that we have officially downloaded 140 directories. We segmented them in Russia, and our biggest base is in Russia. Oh, wow! Of course, the question is what can we do with it? For example, I personally can write a letter. I personally can write “Hello, Olya. I found your email here and you can use our import and all that stuff” But theoretically a robot can do the same, and where is the line? According to the GDPR or any other law on personal data, I am doing advertising, but why can I do it manually, and why the robot cannot? A very philosophical question, but in general everyone is concerned now, not even by virtue of all kinds of legislative initiatives, but simply because we leave such digital traces
that digital hygiene is already becoming a necessity. Thank you so much for the interview. as well I would like to thank you and Ru-centr.
In 2013 or 2012 you were the first in Russia of all hosting companies who congratulated on International Client’s Day!! You were like the ancestor, for comparison, this year there is Beeline, Sberbank and many other banks, and organisations congratulated with International Client’s Day. We are the organisors of this holiday. and you are the first who
congratulated in the industry, meaning, you found this holiday somehow on the internet, i.e. your marketing dep was the fastest and only. Thanks to you we appeared, In different countries the holiday is celebrated, Belarus, Ukraine, Lithuania, but in Russia, you were the first big ones! We added the day to calend.ru, you know, even Nic.ru celebrates, thanks to you for it. You are like an ancestor of this holiday in Russia! Great! Thank you! Thank you!