Since the rise of the smartphone, the world of gadgets has had two poles: Silicon Valley and east Asia. Especially with the decline of Nokia and BlackBerry, the commanding heights of the industry have belonged to Samsung and Apple, with a growing breed of Chinese brands such as Huawei pushing their way in.
Vlad Martynov is on a mission to change that. The first step is the launch on Tuesday of a Russian smartphone. The Yotaphone has a traditional LCD screen on the front and an e-ink screen on the back.
“That is the biggest innovation in the smartphone space since the first iPhone,” declares Mr Martynov, chief executive of Yota Devices, a Moscow-based start-up that was spun off from telecoms operator Skartel in 2010.
Whether consumers agree will become clear soon. The device goes on sale in Russia, Germany, France, Austria and Spain on Tuesday, and in the UK and a dozen other European and Middle Eastern markets early next year.
The launch is not just a test for Mr Martynov’s start-up but more broadly for Russia’s ability to create products that appeal to the outside world and can foster young private enterprises.
Russia’s once-booming economy, overly reliant on oil and gas exports and struggling to attract investment, has slowed to stagnation this year.
The technology industry is much more dominated by private companies than the rest of the economy, and many here say they don’t feel the gloom. But the mainstream of Russia’s tech sector are internet and software companies such as Yandex and Kaspersky.
Developing a device in an industry whose entire value chain is based elsewhere is something different. Mr Martynov says that while core component suppliers were quick to participate in his project – Corning made the curved glass that protects the e-ink screen – finding the right partners for assembling and mass-producing the device took longer.
“We talked to Foxconn and Compal, but they would be more interested in something that can go to mass production in very big numbers very quickly,” he says.
Foxconn is the world’s largest contract electronics manufacturer and one of the main producer of Apple devices. Compal is one of the world’s largest contract manufacturers of notebook computers. Both companies are headquartered in Taiwan and have most of their plants in China.
Yota ended up working with Hi-P, a Singapore-based contract manufacturer that also produces in China. “They believed in BlackBerry when the company decided to move from pagers to smartphones,” says Mr Martynov.
His company, which has fewer than 30 employees at its headquarters in Moscow, set up an office in Singapore to keep in close contact with its manufacturing partner. In another office in Finland, former Nokia employees work in design.
Having mastered design and production, Yota has to prove it can do global marketing. Mr Martynov, a former Microsoft executive who founded and sold ERP, a software company, and invested in two other software developers before joining Yota, is undeterred.
He says Russian tech companies will thrive because they combine strong maths and physics skills with an ability to find simple, practical solutions others might not have thought of – a feature often attributed to the country’s Soviet past. “Our biggest hurdle is our lack of belief,” says Mr Martynov. “We need to create another hero like Kaspersky.”
Yota will not have to rely on that alone. The company is jointly owned by Mr Martynov, Sergei Adoniev and Albert Avdolyan, the two co-founders of Yota’s former parent Skartel. Skartel itself was this year acquired by Megafon, Russia’s largest mobile operator and part of the business empire of Alisher Usmanov, one of Russia’s richest men with interests across, metals, mining and media, and a co-owner of Arsenal football club.
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