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Russia - Telecoms, Mobile, Broadband and Forecasts
Market Briefing
Published: May 2011
Pages: 106
Tables: 139
From: GBP 509.00 Buy Now!
Research from: Paul Budde Communication Pty Ltd.
Sector: Mobile Markets
Publication Overview
This report provides a comprehensive overview of trends and developments in Russia’s telecommunications market. The report analyses the mobile, internet, broadband, digital TV and converging media sectors. Subjects include:
- Market and industry analyses, trends and developments;
- Facts, figures and statistics;
- Industry and regulatory issues;
- Infrastructure;
- Major players, revenues, subscribers, ARPU, MoU;
- Internet, VoIP, IPTV;
- Mobile voice and data markets;
- Broadband (FttH, DSL, cable TV, wireless);
- Convergence and digital media;
- 3G subscriber and mobile ARPU forecasts to 2015;
- Broadband market forecasts for selective years to 2020.
Executive Summary
Russia’s mobile operators unite to extend LTE to remote areas by 2014
BuddeComm’s annual publication, Russia - Telecoms, IP Networks, Digital Media and Forecasts, provides a comprehensive overview of the trends and developments in the telecommunications and digital media markets in Eastern Europe’s largest market.
Having experienced more than a decade of strong GDP growth until 2009, the Russian economy has been negatively impacted by the recent global financial crisis. This is partly due to the country’s reliance on commodity exports, exacerbated by highly leveraged corporations exposed to US mortgage-backed securities and capital outflows resulting from concerns over state interference in the economy. Nevertheless, some recovery has been seen since, and GDP growth is expected to reach 4.5% in 2011 following a 3.7% growth in 2010.
This growth is being mirrored in Russia’s telecom market, which fared better than the economy generally in 2009, growing 2.7% year-on-year. This growth recognises the resilience of telecom services, due to their utility nature and also to the relative immaturity of the market in regional areas – itself a legacy of the inefficient, unreliable and underdeveloped networks inherited from the Soviet era.
Significant changes have occurred with the country’s incumbents. The state’s interest is held in Svyazinvest (75% owned by the government), which was established in 1995. The group was restructured in 2002 when almost all regional incumbent operators were merged into seven large interregional operators. In early 2011 these regional players ceased to exist independently when they were joined to Svyazinvest’s main subsidiary Rostelecom. The creation of an integrated telco, under Rostelecom and operating in many segments, will enable it to capitalise on a scale nationally.
The broadband market has grown with the migration beyond voice-centric offerings to voice, broadband and convergence services. The poor quality of the infrastructure has resulted in a variety of technology platforms used to offer broadband, including xDSL, cable and FttH/FttB. Wireless solutions such as WiFi and WiMAX initially garnered much interest, but has since been overtaken by interest in mobile technologies: the main WiMAX player, operating under the Yota brand, intends to end its WiMAX offerings and migrate customers to LTE by 2014.
Russia possesses a vast broadcasting market undergoing rapid change. Both freely accessible and paid content is widely available from cable TV, terrestrial, IPTV and satellite platforms. Competition is driving new network deployments and network modernisation as incumbent broadcasters face challenges associated with digitising analogue networks and increased competition from new market entrants, particularly from the telecom sector.
Russia also has the largest mobile market in Europe. A number of mobile network operators exist although three major operators (MTS, VimpelCom and MegaFon) dominate. These have expanded nationally through acquisitions of smaller regional service providers. Given the high penetration rate, future revenue growth will be derived from mobile data services based on 3G networks and the deployment of networks based on HSPA+ and LTE technologies. In early 2011 the ‘Big Three’ MNOs signed a deal to expand LTE to 180 cities using a new network to be built by Yota.