Ilya Kenigshtein: Ukraine will have 3G in a matter of months

The creator of Hybrid Capital venture fund Ilya Kenigshtein is one of the people who returned to Ukraine after living a large part of his life in Israel. He returned for opportunities. Now Ilya, as an expert and civil activist, is assisting reforms in Ukraine. He believes that during the war and the transformations of the state, Ukrainians could make very good use of the experience of Israel.

Ilya’s first victory was the introduction of 3G in Ukraine. The tender for the 3G license was successfully held on 23 February, in many ways thanks to Kenigshtein.

– Ilya, how did you come to the IT sphere and why did you leave high-tech Israel for Kiev?

I was born in Lviv. When we left, we left the Soviet Union. When I returned in 2007, I returned to a completely different world.

For the first 8 months in Israel I lived at the Metser kibbutz, I learned Hebrew and milked cows –my first real job was working in a cowshed.

I began my career in IT in the 2000s, at the MSN company, an affiliated company of Microsoft. MSN is a large Internet portal that was very popular at one time, and half of it is owned by Microsoft, and half by an Israeli Internet provider. I was invited to MSN as a person who knew Russian and was a good salesman: by that time I had already worked at the renowned and now legendary Russian-language newspaper “Vesti”. They invited me to make several pages in Russian for Russian-speaking users of the provider. I offered to do more, to create an Internet portal for Russian-speaking Israelis. The people at MSN briefly thought it over and agreed. In three months I created the portal zahar.ru, which subsequently became one of the symbols of Aliyah in the 1990s, along with the “Vesti” newspaper and the “Israel Plus” TV channel, which is now known as “Channel 9”.

I ran the portal zahav.ru for over five years, from the moment it was founded. Over time the project transformed from a start-up into a stable business, the market leader, and an entire industry was created around it – content, advertising and PR. At a certain moment it became quite boring: nothing changed, the owners still saw us a sectoral project, resources were not allocated to development, all the money earned went to support other, unsuccessful projects. After I left, the Internet provider was closed down, and the assets were sold off, and the main asset was zahav.ru – it was sold to the major media holding Walla! Communications.

I got an offer to move to Kiev and become the head of a major media structure, and I accepted it. Later I launched my own company. I’ve been living and working in Kiev ever since.

– Where were you when Maidan began?

For a while my wife and I had the concept of living in two countries. This is when you get up in the morning, go to the cupboard, look for your favorite shirt and suddenly remember that the shirt is in another cupboard, in another country. When Maidan began we were in Kiev, and we decided to stay in Ukraine. It was quite a difficult time, I won’t say that I took part in Maidan very actively – of course we often went then and constantly kept up with what was happening, and tried to understand the situation. You already know what happened next. After the victory of Maidan there was a drastic rise in public activity in Ukraine, and many of us, including me, began to think about how to be useful to society, to the new state.

I started working in two different fields. Firstly, I began to talk about Israel – the Israel I know, love and value, a country of high technology, startups, venture capital and completely different principles of doing business and partnership that what was around me. I began to give speeches about this topic, prepare presentations, and unexpectedly there was a very positive reaction. I felt a genuine, sincere interest from Ukrainians – new, and alive. We found that Ukraine and Israel had a lot in common, and one of the common factors was war. There was also the feeling of the general consolidation of people, which in itself is already very rare for modern societies.

Secondly, along with a friend from the IT community I went to the civil association “Resuscitation Package of Reforms” (RPR), and I proposed to solve the task of introducing 3G in Ukraine, as this problem has not been solved simply because of corruption. This was in early May of 2014. We met with representatives of RPR and told them what 3G was, and how important it was. RPR decided to support us, and I gathered a group of professional managers from the telecom sphere, and we started methodically, day by day, working on solving the task. In July of 2014, President Pyotr Poroshenko issued a decree to organize a tender on the introduction of 3G. We thought this was a victory, and that we could now go home. But this wasn’t so. As it turned out, the president’s decree was strictly of a recommendatory nature, and executive power represented by officials of the Cabinet of Ministers were in no hurry to implement it.

– Why was this topic so important for you? Internet speed is hardly a priority problem for Ukraine at the moment.

Firstly, it was important that this project was realized by civil activists, as this is an indication that anyone can do this. People on the street can get together and achieve something, and this isn’t fantasy, it’s reality.

I didn’t have any intention of using this in my own interests, to convert it into capital, as was the practice in the past in most rules of Ukrainian lobbying. I simply wanted my friends and me to have fast Internet in our telephones. This is normal for all developed countries.

And secondly, the lack of 3G today is an elementary deprivation of civil liberties. 3G is not a goal, but a tool. For example, it is directly connected with an electronic government. The state, business and society in Ukraine so far have a poor grasp of how to use third generation technology, and here serious explanatory work is required: how to harmonize social and state institutions correctly, how to use 3G in education, medicine, science etc., and what this gives for the development of IT. For 3G essentially means the electronic entry into the European Union.

The Ukrainian Prime Minister did not want this at all at that moment. When we started to push for the realization of the presidential decree, we encountered resistance from almost the entire Cabinet of Ministers. First they ignored us. Then they announced that they were prepared to organize a tender, but only with one license. Then we organize a civic campaign outside the Cabinet of Ministers: we brought in a Soviet telephone booth, hung with old disk telephones, and offered officials walking by to swap their mobile phones for disk phones. 10 TV channels turned up, there were lots of people there. Thanks to this campaign, at the session of the Cabinet of Ministers on that day, they announced that three licenses had been granted. This was the second victory.

But after this, again nothing happened. There was a complete blackout. The Prime Minister calmly completed his first term, ignoring objective reality. We realized that we had to involve the masses and we appealed to representatives of AutoMaidan for support. I don’t know how it happened, but literally a few days after we reached an agreement with AutoMaidan, Yatsenyuk signed the tender conditions. The tender was held on 23 February, and three companies took part in it: MTS, Kievstar and Life. They pay colossal sums for the licenses. Now it is a matter of months before 3G comes to Ukraine. We will continue to push for technological neutrality and to introduce the communications standards of the fourth generation – 4G.