A new piece of protectionism legislation aimed to take effect on July 1st of this year will now require that all computers and mobile devices sold in Russia will need to have pre-installed Russian software. This would require foreign companies to now pre-install a web browser developed by Yandex alongisde other applications. What this would mean is increaed costs for licensing fees and technological developments at the companies' expense. This new piece of legislation will affect companies such as Apple, Google, Samsung, and Dell and could also potentially harm the market especially for manufacturers as some operating systems may not be compatible with certain external applications. This can make it harder and more costly for these companies to sell products and operate within Russia, in turn potentially making it a location they no longer participate in. 

Facebook and Twitter are also under fire for being in violation of a legislation placed back in 2017 which requires Russians' personal data to be stored inside Russia. Currently, both companies store that information outside of the country and calls for those websites to be blocked have continued as they have allowed for anti-kremlin content to be published. Another company, LinkedIn, has declined to follow this piece of legislation and in turn had been immediately blocked from viewing within Russia. Streaming companies such as Netflix and Apple TV have unknown future at the moment despite Apple TV having kept a relatively low profile. Russia enacted a law two years ago which restricted the ownership in video streaming services to 20% stakes so long as the number of subscribers is over 50% of all Russian video streaming users. Neither Netflix or Apple have released their subscription numbers in Russia, however they will be requied to do so. If it is found that they have reached the 50% mark then it is likely that their operation will become illegal. 

I think this is a great illustration of how protectist laws enacted by a country can have affects on whether or not comapnies can operate within that country or how they would have to go about changing their operations so that they could continue to sell their product within that country. For companies such as LinkedIn, which have opted out, the result is they are permanently blocked from access which eliminates an entire geographic region from their potential customer base. 

 

Link to Article: https://www.hollywoodreporter.com/news/new-russian-legislation-targets-apple-facebook-twitter-netflix-1264747

 

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  • Many thanks for this enlightening post on increasing digital regulations around the world. This adds to an increasing list of challenges that businesses have/will have to deal with when operating globally:  the EU GDPR, how the internet is regulated among countries, the French digital tax now on hold until the OECD comes with its own taxation plan this year, the CA Consumer Privacy Law, the net neutrality, the fight over 5G leadership (opposing countries banning, partially banning, or not Huawei), Google calling for IA regulation, and so on...

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