“He who knows everything” sees great potential here

Dmytro Sholomko has practically brought Google to Ukraine. He says, at the beginning he had to persuade the central office to look at Ukraine with less caution. It took him three years to change the perception of his colleagues. Now all the basic products of the company are present on Ukrainian market. The head of Google office in Ukraine dreams that in the future all products the company brings to the market will immediately appear in Ukraine.

Our conversation turned out to be exclusively interesting and open. Dmytro is a very joyful and self-critical person. But why this joyful guy in jeans and a fleece was not present at the Presidential Council of Investors, for his company is quite a big investor by Ukrainian standards, and he himself has proved that he knows how to persuade big investors to work in Ukraine? You will read the answer to this question and many other unexpected things below, in an exclusive interview to The Day by Director of Google office in Ukraine Dmytro SHOLOMKO.

What surprised you in the results of your survey on how the Internet influences the development of Ukrainian economy?

“The difference of efficiency between the companies that use the Internet and those which don’t use it. It’s like a huge abyss. For example, whereas the companies with the Internet increase the number of employees, those which don’t have it – reduce. Incomes grow in the companies with the Internet, and in the companies without it – no. Such things are a huge abyss.”

Did you expect that this abyss would be smaller?

“Yes. It turned out that the Internet in Ukraine is functioning more efficiently than I expected. I saw similar surveys in other countries – there is no such abyss. It turned out that technologies in our country are more efficient.”

UKRAINIAN AND RUSSIAN INTERNET MARKETS ARE CARDINALLY DIFFERENT

Your presentation coincided with another event, broadly highlighted in the press: RF Prime Minister Dmitry Medvedev signed the bill on changes in the strategy of development of IT industry in Russia. What effects will these changes have for Ukraine? Will the refusal of the RF to support foreign offices of IT companies on its territory mean that they will reorient to Ukraine?

“Ukraine is not Russia. Our markets are different. Perception of technologies and use of services are very different. The ways Russians and Ukrainians use the Internet are very much different.”

You aptly noted that this is not the first strategy approved by the Russian government. Nonetheless Ukraine does not have yet any unified document that would be called a Strategy of Development of IT Industry. Vice Prime Minister Oleksandr Vilkul promised in a commentary to The Day that such a strategy will appear next year; he said it is being developed by a group of experts. Are you part of this group?

“Ukraine is not Russia. Our markets are different. Perception of technologies and use of services are very different. The ways Russians and Ukrainians use the Internet are very much different.”

“We’ve talked about it with Oleksandr. The thing is that we have just started to work in this direction in Ukraine. Our office is quite young; it is only the third year we have been working in a normal regime, and we need some time. We have a strategy of our own, and we are trying to realize it. It includes interaction with the governmental bodies, solution of certain tasks which would be of use both for us, and for the state. But so far I cannot say we are part of a working group, etc. We will work on this. This is very important. We know a bit more about these technologies than others. And we are ready to help the state develop them.”

BELARUS IS THE SECOND INNOVATION COUNTRY IN EASTERN EUROPE

What remarks does your company have to the support/regulation of the IT sphere in Ukraine?

“They are doing something. The state is trying to help them. We consider these as good steps, which should be done. But they need some more time. When I answer such questions, I always give the example of Belarus. This is a strange country, where IT product has started to bring almost 10 percent of GDP, because they have a High Technologies Park.”

But they have censorship on the Internet, too.

“These are very different things. At the moment we are speaking not about the Internet as a system to use, we are speaking about the Internet as a business. Namely Belarus has created such an export model, which makes it the second innovation country in Eastern Europe and in the Middle East after Israel. This became possible owing to governmental support. I can say that Ukrainian government is also doing something interesting in this regard, but they need to do more. And Belarus is a good example to follow.”

Do you support the idea of an analogue of the Silicon Valley to be created in Ukraine?

“Formats can be different. The most important thing is the desire to do something.”

But under current level of the Internet, is there a need for one geographical location?

“This is what I mean. Again, we have the Park of High Technologies, but not all companies registered there are located there. There is no need to be physically located in one place.

“California’s Silicon Valley performs the function of a symbol. Of course, the number of events and trainings is higher there and people involved in this business live there. But New York is no worse place to develop technology business. Let’s have a look at Boston, which is the second biggest center after the Silicon Valley in the US, because the IT Harvard is located there. There can be analogues, but there is no need for a physical analogue. There is no need to build five houses for IT pros to stimulate the branch.

“On the whole, the components of the Silicon Valley include a good educational establishment, high level of education, preferences, or tax exemptions and lack of governmental control, to enable self-stimulation. Another important component is presence of specialists who could exchange thoughts from any place, virtually or physically.”

UKRAINE IS NO MORE PERCEIVED AS A COUNTRY OF SMALL BUSINESS POTENTIAL

During my preparation for the interview I read many publications about you. In one of the interviews you admitted that when you came to work to Ukraine, it was hard for you to convince your partners that Ukraine was not a country of high risks, like they perceived us.

“It is not about business risks. At that time the thing was about great business potential. There are rankings in which the markets of different countries are compared, based on different indices. So, according to official data, Ukraine is far from being the first country in this region in terms of business growth potential. When I started to work here, it was hardly the best place for foreign business, in terms of GDP indices per capita, development of technologies, etc. I needed to show to the company where this potential was and how it could be realized. And I succeeded. So, the question was solved.

“For big foreign companies it is hard to feel the export potential. This is a possibility to make some product in a country with an aim to realize it beyond this country. It could be anything. The world knows the export market of Ukraine as the export market of pipes, rolled iron, and steel, whereas Ukraine is one of the biggest export markets of technologies. There are numerous companies which create different services in Ukraine for users beyond Ukraine. And namely this was my main trump card to attract foreign investors.”

If I am not mistaken, you were not present at the recent session of the Council of Investors with the President of Ukraine, like at three previous sessions. Why?

“Everything is very simple. When the Council was created, companies with foreign investments, which paid the highest taxes, were chosen to become its members. At that time Google was hardly present in Ukraine. That is the reason why we could not pass this filter. If they update it, we may get in. I don’t know. Anyway, we have a strategy of our own and we are trying to interact with the government. We have things to work on even without an official participation in this kind of organizations. Some time is needed for Ukraine to achieve a high level.”

GOOGLE+, GOOGLE GLASS, AND GOOGLE LABS...

Google has seriously taken up the “power leveling” of Google+ social network in Ukraine. When you launched it, you had a record increase of the number of users who registered there. But later we noticed – in particular, taking into account the indices of The Day’s page – that this service is no competitor to Facebook. Currently there are many users of Google+, but few of them are active. Is this a special feature of non-English-speaking audience?

“You see, unlike Facebook, Google+ is not a social network. This service has a totally different task. Google+ is above all a social superstructure to top other Google resources. It was created not with an aim to win over Facebook audience, but in order to add social character to all functions of Google recourse. It worked best with YouTube, because it is a small social network connected with video content.

“Google+ is a component added to YouTube to make it more social. The same refers now to the search tool. But the most important thing is not to perceive Google+ as a social network. This is not Facebook. Its tasks are different.

“We have studied the question why people on Google+ are less active. This is connected with several situations. The most important one is that we give an opportunity to our users to receive information via social add-ons.”

What is the prospect of Google Glass to be sold in Ukrainian shops? People write in forums that today “Google glasses with inserted camera are classified by Ukraine’s Security Service spying equipment for secret access to information, which is not allowed to be sold freely. So, it is forbidden to bring Google Glass into the country. Those who break the ban will face up to seven years in prison.”

“Read the official statement of SBU in this concern. I don’t know who started this gossip.”

Is this a gossip?

“Yes. But how did it turn out so? Some publication asked the SBU questions on our product and an SBU representative said they could not say anything about this, all the more so make conclusions. But the reason above all is that nobody appealed to them in this concern or held expert studies. In fact we did not do this, for Google Glass is an experimental product, which does not have a commercial plan or a plan of distribution beyond the USA. Therefore the Google Company has not made any physical or factual efforts to localize Google Glass, in Ukraine among other countries.

“At the moment Google Glass is being tested by several hundreds of bloggers, who according to the terms of the program spend part of their time in press tours. I know that this people have crossed Ukraine’s border among others and they did not have any problems.”

Google has shut down such projects as Wave and Buzz, and now there is information that Google Labs are going to be closed, too. Why do they need to shut down projects which are really useful and popular at first glance?

“Wave and Buzz weren’t efficient enough. There were many complaints within the company. Frankly speaking, I don’t know what categories make a priority for our bosses, when they approve this kind of decisions. But I know pretty well that when Larry Page (I have met him a couple of times and I like him very much) decides on something, he has reasons to do so.

“We don’t take part in discussion of questions on launching or closing the services. We fulfill the instructions from California. Often it happens so that there are many disputes on the shutdown within the company, but if Larry Page, an intelligent and rational man, approved this decision, there is certain sense about it.”

ANDROID IS AN AUDI, AND APPLE IS A PORSCHE...

Can Android market compete with Apple on equal terms? Google is producing Android freeware, which is very popular, but people still buy paid “apple device,” why? On the one hand, as you have noted at one of your recent seminars, “Ukraine is not ready to perceive paid content,” and on the other hand, people prefer a paid office, when there is an opportunity to use the one that goes free of charge and is of no worse quality.

“You are wrong. Everything is vice versa. For example, in Ukraine six times less Apple products are registered on the net than those that work on Android. We have conducted a research of the number of phones and operation systems where they are installed. Android systems are far ahead.”

What about the world tendencies?

“They are the same. It seems to me there are about 15 percent of Apple products in the world, and 40 percent of Android products. The thing is there is no money competition. There is a competition of perception. Apple is a premium, it is the content hidden from others, and the products of the company are always very nice-looking. Android has somewhat different tasks. It is open for everyone, everyone can have access to it, and sometimes it is even cheap in a good meaning of the word. These are simply two different strategies which can freely coexist. And there is nothing bad about this. This is a normal situation. I don’t think there will be a war regarding this.”

So, you make a Ford, and they – a Mercedes?

“I can say they make a Porsche, and we – an Audi.”

At the same time companies, which distribute paid services on the market, are quite critical about Google strategy. For example, Microsoft.

“Simply Microsoft’s policy is to some extent aimed to counteract Google. This is a normal situation, which does not disturb us. They are doing something, and we are doing something either.”

They say you are spoiling the market.

“Clearly. We make free access to many things, for which they would like to get paid (chuckles).”

LOCAL DOODLE WITH COSSACKS GATHERED MANY COMMENTARIES ON THE COMPANY’S WEB PAGE

The prospect of global Ukrainian doodles. Is this question being developed? What Ukrainian topics are favorable in this context?

“You see, little global doodles have always existed. There is a common culture and common history of the country, which ceased to exist 20 years ago [USSR. – Author]. When we make a doodle to commemorate Mykola Hohol, we make it not only for Ukraine, but other countries which could read Hohol.

“Let’s say, a grandiose topic is needed for a global project and big markets. At the moment we are looking for things that could be much more global. Ukraine does not have a topic that could impress the American user. If you know such topic, tell us and we will try to promote it. There are many cultural things specifically for Ukraine, which are locally Ukrainian. I don’t know whether it is good or bad. Anyway, these are doodles published locally. Google tries to spread them on its pages, in particular, on Google+ and on the global market. I know for sure that Ukrainian doodles are perceived very positively. The same Cossacks evoked a storm of positive commentaries from users from all over the world. Or the things we made on Independence Day. They evoked many positive emotions too. So, we have a global influence, but it is so far difficult to find a topic that would be connected with Ukraine and that would be interesting for everyone.”

The offices and working conditions, especially the employment benefits in Google, in Ukraine are legendary: breakfasts, dinners, and suppers are prepared by cooks hired for the office; a round ticket home is paid by the company twice a year. How many Ukrainians are working in the company?

“Many. I haven’t counted. They are working all over the world. Many Ukrainian engineers are working in many engineering centers. Ukrainian non-engineers work much on Ukraine. When I started, there were three of us. Now, seven years later, we have over 100 people who work for Ukrainian market on a regular basis, because the project in Ukraine often needs work of other departments, which employ not only Ukrainians. When we started, we launched eight offices, which employed not only Ukrainians, but also Poles, Swiss, Hindus…

“We have no limitations in this regard. We don’t ask people about their nationality or religious beliefs when we hire them. If this person suits us, we will do anything to hire him or her.”

WHY THE EMPLOYEES OF UKRAINIAN OFFICE CANNOT BE GOOGLE SHAREHOLDERS?

What are the prospects of launching an office like Google office in New York in Ukraine?

“We are working on this. This is a thing I want to achieve and make in this country.”

Will there be a swimming pool?

“No. To have a pool, the office must employ several hundreds of people. Ours will be a regional office. And regional offices are always more modest than the central ones. For example, in Dublin, Zurich, or New York. The Zurich office employs over thousand people. Of course, they need gyms and pools. Regional offices employ about 10-13 people. We will have a nice office, but without a swimming pool.”

Do employees of regional offices enjoy the same employment benefits as the employees of the entire global network?

“Yes. Only sometimes we need to adjust these benefits to local legislation. For example, the employees of Ukrainian office cannot be Google shareholders. We don’t own the company’s shares, because, according to Ukrainian laws, we need NBU license for this. And Google abides by all Ukrainian laws. The company invented another kind of reward for our employees.

“But on the whole all social packages are more or less equal for all employees of any Google company in the world. Only some legal nuances differ.”