The Path to Future

Editor: I would like to start the talk from afar. Given the specialization, I was familiar with the offices representing new technologies during the soviet years; indeed this recognition was to some extent, since those were mainly closed offices. I also followed the operations after the independence, the gradual mental renaissance of the sector. You are one of the individuals of the field who has a reputable role; however you represent a totally different specialization. You deployed both your first specialization, the work experience, and during new times, anew situation, you managed to become one of the leading heads of the economy primary field. It is already seventeen years, that you are in the IT sector, and during those years the former reputation was recovered, numerous new challenges were gradually overcome; the government consistently deepens the attention toward the branch. Armenia’s long term path to promote the country was newly smoothed out in front of us.

Hovik Musayelyan: As you may know, about twelve years ago the government announced IT sector a priority for economic development. Indeed, there was ample ground for this crucial decision, and it was in this field that we had the best opportunities to succeed at that stage.
The necessary preconditions for the branch development gradually established, for instance stable energy supply, available and affordable internet, favorable geopolitical and business environment for investments, formation of the country’s new image and etc. Without the entry of international organizations into the IT sector, without the adjustments of the educational criteria to the international standards, the development of new business culture is hardly possible. To reach all the above, both partners (who would pursuit perspectives) and time would be needed to create everything step by step, anew.
It seems natural, that if you announce a field to be a priority, you should create conditions for a fast and effective development of the field, grant privileges and etc. In fact, lately we have witnessed similar steps, in particular, the establishment of free economic zones which provides privileges to some extent. Recently the RA government has represented a new legal act to RA National Assembly, according to which start-ups are exempt from revenue tax in the meantime income tax is decreased to ten pecent.
This refers to the IT startup companies the establishment of which is contributed and encouraged by many countries worldwide. I think this is a very important decision which will contribute to the technological entrepreneurship among the youth, and this decision will have a positive impact on the overall IT sector development in our country.
Now, what situation are we in? To be employed in a transnational company seems to be a final milestone for the young people. Many are satisfied with this, it seems their life goal is embraced in it, and that’s the end; there is no stimulus to dream further. The IT entrepreneurship does not undergo development since the young do not believe, that any one of them may initiate a personal business and realize it, we do not have such a culture so far. Whereas commencing from a start-up is quite an ordinary development. If we observe the activities of the people famous in the field, we will see that they have mainly started from start-ups. And the positive side of the government’s step is that, we also already have this comprehension, that due to the accurate results of the people’s involvements in the field, the fairness of the sector announced as priority was displayed, and that, indeed, the issue has matured to the level, that the work should be given momentum, continue to aspire via laws and governmental practices. This development is extremely important for our country, for a sphere of the economy.
Moreover, if we contribute to the increase of those interested in entrepreneurship, we may register, that this decision has been revolutionary in this regard. I do not exclude, when those results occur, the government will seek for more radical reforms and will free the startups from taxes at all. It is a global practice, that in the countries, where IT sector is encouraged by the state, all the remaining fields develop by a chain reaction. This is the characteristic feature of this branch; since saying IT we do not imagine only one field, it is a multifunctional, consolidated and a very serious system, where even the development of one component is an important impulse for the general development. And these components are the fields of research, education, engineering, innovations, the uplift of the state’s safety, increase of living standards, the positive impulses toward future trust, the psychological important factor of a personal impact, and finally, the ambitiousness of having one’s participation, which, perhaps may be tiny, in the global economy, yet personal.
In future, each component may be supported with radical privileges for its further development. However, we must record that the government has made a huge step (which should be acknowledged) and we should try to gain dividends from it. And if we extend the examination scope, we may state with confidence that this way we contribute to the formation of a competitive, serious field, not only among the start-ups, but also between those and the brand companies, since the customers or the investors may address the proposals to the start-ups, it is possible that those may give better results, rather than applying to the traditional brand companies. Turnover may also be possible, highly qualified specialists may be demanded. Definitely, a new competitive field will be shaped for the famous corporations working in Armenia, since if there are no start-ups, than those are the dictators, the monopoly belongs to them, whereas the start-ups will first establish, later unite with others, and it is possible that new serious companies, influential powers emerge into the field.

E: I wonder, if the fundament was not created and shaped during the Soviet years in the country, today we would still bend along this direction any way. However we would have lost a very important timeframe, and would digest anew all, the base of which was given in Armenia in the 50’s, thanks to the scientist Andranik Iosifyan’s personal efforts. Fortunately we had that wealth-path, we also had the bridge over the generation coming from the past and linking the future, which was supported by the genetics. Thus we had a new educational basis; it was them who made the path toward the future smoothly. This sector is of importance to Armenia, in terms of workforce, and even the legacy coming from long ago, and the regional deep challenges, and the conditions, in the meantime this served as model demonstration for the other fields of the economy. Indeed, in present we link our hopes to the young generation. However let’s verify the mission of the transitional generation, which was accomplished by many in a wonderful manner. The young are powerful not only by themselves, but first of all due to the traditions’ heritage and those young people who pass on the heritage.

HM: The generation gap, likewise everywhere, in this field is imperative as well, and we witness how the new generation enters into new life. Today, the generation born during independent years has matured, and entered into life, those are young people of ages twenty-two to twentyfour, who graduate from the programs of diverse partner universities and receive work proposals while studying. If we observe with a percentage ratio what age groups work with us, we will see that the dominating part make the youth born during the independent years. I should confess that it is interesting with them. They think freely, are not embraced with stereotypes, are much interested in everything.
However we were more respectful both to each other and the elderly. Though there were many artificial things in the soviet years, at the same time the society was living in a calm and peaceful aura.
For instance, during the Gorbachyov years, we were all excited to see some chances, and we were trying ourselves in an absolutely new sphere of leading a business. In 1993 I was in the government, working late to 1-2 am, than we were going home on foot. It was dark, cold, there were many wandering dogs in the streets. We were so excited, full of hopes, feeling that we are a part of a very important event. We worked for a very little compensation. No one whimpered.
Meanwhile today’s generation is aspired, patriotic, however less respectful toward each other, they do not like to listen to the elderly much, they think they know everything. If we observe the generation ratio in our company, the managers comprise the mid-level, people of mature experience, whereas among engineers there are many young people, however they have yet much to learn. To my mind, the difference when comparing my generation with the one of my parents does not comprise much, meanwhile it is much when comparing my generation and the one of my children. They do differ a lot with their mindset and knowledge. Even when talking to small kids, they are so much informed, that it seems they are small adults. This is obvious during our committee meetings of “Annual Educational Award of RA President in IT Sphere”; while interviewing kids, they express such ideas, that one remains astonished.

E: It has been already ten years, since the “Annual Educational Award of RA President in IT Sphere” has been established to disclose and encourage the youth. We have recorded that the past heritage was successfully transferred to the youth, and that there has been a change within the generations that one can hardly imagine. Let’s come to the main topic- the award. Within these ten years, it was in your environment that we witnessed the tight union of concept and reality, the speed of those changes, and the “Annual Educational Award of RA President in IT Sphere” was launched to be granted to the students and pupils, in the meantime there is an award of higher level, where the winners are outstanding people. Hence the “Annual Educational Award of RA President in IT Sphere” establishment should not seem either spontaneous or surprising, since the life was dynamically being developed within the structure, and indeed, such ambitious programs could be designed, and moreover, could be realized.

HM: The “Annual Educational Award of RA President in IT Sphere” was founded when I introduced the concept to the adviser of the second President of Armenia Armen Gevorgyan, he immediately recognized its attractiveness, and supported the award launch. There have been no challenges related to this, the Presidential decree was rapidly ratified, we also arranged all the organizational preparations, and it has been already ten years since it is being accomplished. During the first year two universities and three schools participated, now we have eight schools and five universities partaking, over the years the scope was extended, they are getting ready for the interview at the schools, the schools treat their students triumph as huge honor. It was a pleasure to meet with the committee, talk to the selected kids, be delighted with their brave mindset, the ability to analyze, the ideas they express, and to see among them our future partners, the ones to be replacing us.

E: I have attended few meetings, indeed it is hard to select someone after interesting interviews with numerous smart young people, after getting acquainted with their ideas, their mindset. One should somehow differ to win.

HM: Rich Goldman has a great role in the establishment of the Global IT Award. In 2008 he once asked me on my approach to establish an award to be granted by the country President to outstanding authorities of global recognition. He added that the visits of that kind of people and the granting of such an honorable award would be spread worldwide. It would raise interest toward the country. I asked for time to convey that to the President, and to hear his opinion and receive his consent. To be frank, at the first moment it was difficult to imagine that those people would come, that the award would be feasible. Fortunately the President’s standpoint was positive. However, when discussing the details, an opinion was uttered that the award could suppose financially huge amount as well. My personal opinion was that the award should not have any financial attraction, since shortly afterwards (as it is usually done thanks to us), the Azeris’ would define a similar award themselves, will gift huge amounts, and the outer world would think that since their amount is higher, for instance is a few millions, than their award is more reputable. We have emphasized more on the image factor, the moral side. The decision was made. Of course we were well aware that it would not be easy. An important and obligating condition was on the first laureate, since later the winners would be interested and get informed on who were former winners. We had a very accurate selection; the first laureate was “Intel” Corp. retired CEO/Chairman of the Board Craig Barrett, a charismatic individual, who travelled to Yerevan with his spouse four years ago. His spouse was yet another charismatic figure – the US ambassador in Finland. We arranged a dignified reception for them, they received the award from the RA President, got acquainted with the country. In 2013 we met with Craig Barrett at the ArmTech, in American Silicon Valley. His participation was reputable for the congress. Later the committee selected Bill Gates as the laureate. However he responded that he did not plan any visits to the region within the upcoming two years, however was glad to be honored. We could send him the award, however our purpose does not lie in the awarding itself either the laureate is Bill Gates or any other famous person, rather we aim to bring such bright people to Armenia, to give the youth the opportunity to communicate with them, also to acquaint them with our country, and its scientific potential at the spot.
Later Steve Jobs’ variant was discussed, the committee voted in favor of him. It was attractive to us given his step mother was of Armenian origin who had brought him up from early childhood. Unfortunately, Steve Jobs’ disease progressed and he passed away untimely. Since Steve Jobs’ name was very famous in Armenia, and his activities were straightly related to Steve Wozniak’s name, the committee selected the latter. Wozniak visited Yerevan with his spouse as well, his visit was well covered in mass media, and the youth met him with excitement, which certainly gave a new glow to the award. The third laureate was Federico Faggin (one of the founders of microprocessor), the fourth laureate was former CEO of the Hitachi company, Tsugio Makimoto, who stayed in Armenia for ten additional days, since he was so much interested in our country’s history and inner potential that he had seen in our youth.

E: I have seen excitement in the faces of all laureates; they have travelled to a country unfamiliar to them. However are delighted, are talking about the country and the youth, as if a discovery. Truly, it is the natural interaction that brings people closer.

HM: Today, if Armenia has a club of friends and those people are of broad scope, science, culture, and etc., than we definitely see these four people as that club member. Imagine, in ten years, ten bright people, who have had a big input in the science worldwide, will definitely have undertakings either in Armenia or for Armenia. These people have been to Armenia, have delivered a lecture for sector specialists, have had a crowded meeting with the youth, been introduced to broader public via mass media. For instance if Wozniak delivers a lecture somewhere, he evaluates the work for hundreds of thousands of USD. However, he was in Armenia for four days, he had diverse conversations during different meetings, had Q&A session, and after being granted the award from our President, announced all over the world that there is no Nobel prize in the IT sector, and he treats his Armenian award as a prize equal to the Nobel Prize. I give exceptional significance to all the above mentioned. This is especially necessary for the new generation. Of course there were many pessimists, people considered it simply impossible that the award would be a reality. They were confident to say that the laureates would not come, that no one is in need of all that. But believe me; one can’t do anything at all if he listens to these pessimists. And if there is a group of people, who are initiating, inspiring, who are allies, who believe in the initiative, than one should be brave to fulfill his idea.
There are different awards in different countries; however the rating of our award is quite high. And here it is of utmost importance that the laureates are outstanding people, those are people of revolutionary input in the overall progress of the humanity. We are asked: “What dividends do we have?” T. Makimoto would like to introduce the Armenian factor in the Japanese IT sector. Moreover, he is planning to write a book about Armenia. This is the work, the outcome of which we should see a bit later.

E: All four laureates are businessmen who have transformed idea into wealth. Whereas a bright man of ours solely dreams of higher compensation. We still take wealth as trade, monopoly, business. So far we have not faced a reality of idea-wealth transformation ultimately resulting in real wealth.

HM: Our main challenge in the sector is that the young underestimate their direct participation in it, they prefer employment in good companies, and are satisfied with that. The progress of the sector is supported by start-ups, who should transform the ideas into products, try to find markets, customers; however this operation is not possible without financial involvement. That is, the established rich of diverse fields should be the investors so that the start-up develops its operations. The new initiative of the government is to encourage the investment flow as well. Indeed, the IT sector is both attractive and risky; everything changes so rapidly, one does not know how much the created product will be demanded, by the time it is released. However I am confident that we have reached the milestone. To be competitive, within the price of any product the intellectual part should be decisive. I think a new generation of entrepreneurs should mature, which will fund the intellectual business. I am glad that the first step has been made in Armenia.

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