Russia

iPhone stumbles in Russia

Paul Rasmussen — Wed, 25 Mar 2009 14:23:40 -0400

Russian consumers have failed completely to grasp why they should pay an exorbitant fee for the pleasure of using Apple's iPhone handset, albeit that it has achieved iconic status is Western Europe and the US. Sales of the iPhone by Russia's three largest mobile operators have been weak with only 230,000 being purchased in Q4/08, and sales have fallen by 30 to 40 per cent since the start of 2009, not helped by the Russian currency losing 30 per cent of its value.

The three iPhone operators are reported to be urgently requesting a renegotiation of their non-exclusive deals to carry the 3G iPhone, which went on sale last autumn. MTS had signed to sell one million iPhones by October 2011, while Megafon and VimpelCom agreed with Apple to sell 1.5 million between them. The three operators now want to cut their unit sales obligations and the price they pay for the iPhone. Analysts claim about half of the iPhones imported into Russia last October remain unsold.

The price of the iPhone in Russia today is between US$400 and US$800 which is seen as beyond the reach of all but a very small minority. However, the situation has been clouded by consumers obtaining iPhone on the grey market for a substantially lower price, with the latest estimate that 500,000 iPhone are in use in Russia at present.

Sales of the Apple handset are also said to be very slow in India where price sensitivity and a consumer desire for prepay, as against the iPhone contract model, is prevalent.

It remains unclear if the situation in Russia and India could improve if, as heavily rumoured, Apple will launch four models of its iPhone handset. The devices are speculated to have HSPA capability together with video capture--which doesn't sound like a move towards a low-cost device.

For more on this story:
Rethink-Wireless and The Register

From Russia with concern - where next for MTS and VimpelCom?

Paul Rasmussen — Fri, 07 Nov 2008 13:09:18 -0500

Russia's two largest MNOs took giant steps in October to reposition themselves in Russia and the CIS region. For MTS, a strategic partnership with Vodafone followed a two-phase attempt to place 20 billion roubles in bonds. VimpelCom has also sought to raise funds and has scooped a 49.9 per cent stake in Russia's largest mobile handset retailer. However, despite these concerted attempts to reposition themselves, the effect of the global economic downturn and political exigencies could wreak havoc. For MTS and VimpelCom, the Russian mobile market is fast maturing. Mobile penetration is running about 130% and Ovum forecasts that it will exceed 150% by 2013. Speculation is rife that either of them could even expand beyond their regional Eurasian footprint to target markets in Africa and Asia. Article

Russian operators sign iPhone agreements, despite illegal imports

Paul Rasmussen — Wed, 03 Sep 2008 12:52:47 -0400

Megafon has become the second Russian mobile operator to sign a distribution agreement for Apple's 3G iPhone handset. Vimpelcom, the No. 2 operator in Russia, signed up to the iPhone last month, but only after 'persuading' Apple to drop its onerous 10 percent revenue share business model.

However, Russia is already one of the iPhone's biggest markets because of illegal imports. A telecoms analyst at UniCredit Aton estimated there already are more than 500,000 iPhones in the country with monthly "grey" imports running in excess of 20,000.

The device has become something of a cult item among the political elite with handsets changing hands for above US$1,000 -- a US$600 premium over the suggested retail price.

MTS, the country's largest operator, is also rumoured to be negotiating a deal for the iPhone, meaning yet another of Apple's "mandatory" contract clauses of carrier exclusivity has pretty much gone out the window.

For more on this story:
- go to Moscow Times and MocoNews

Related articles:
MTS to purchase largest Russian cell phone retailer. MTS story
Russia's MegaFon mulls €3B Iranian venture. Megafon story

Clearwire eyes European WiMAX partnerships

Paul Rasmussen — Thu, 26 Jun 2008 14:06:49 -0400

Having collected together a number of heavyweight backers for its U.S. WiMAX deployment, Clearwire has revealed that it is considering partnering with European firms to help it deploy mobile WiMAX. The company owns licences in seven European countries, covering 200 million people. "There are ongoing talks about potential partnerships," said Clearwire CEO Ben Wolff. "The transaction in the U.S. has prompted some interest. It might behove us to partner with those companies who might bring something more to the table." Without revealing any names, Wolff said companies of interest could bring with them network infrastructure and subscriber bases.

Clearwire's expansion into Europe goes back to 2004. Since then, Clearwire has acquired 3.5 GHz licences in Belgium, Germany, Ireland, Poland, Romania, and Spain, and through its affiliate in Denmark, Danske Telecom A/S . As of the end of March, Clearwire had just 51,000 customers in Brussels and Ghent, Belgium; Dublin; and Seville, Spain. Separately, the European Bank of Reconstruction and Development (EBRD) is planning to invest up to US$20 million in the Russian WiMAX broadband Internet provider Prestige, a wholly owned subsidiary of the Enforta Group. The investment, designed to improve Internet coverage in Russia, will help Enforta increase its service area to 55 cities.

For more on this story:
- go to EETimes and Unstrung

Related stories:
Clearwire expects 30 million subs by 2017. Clearwire story
Comcast CEO offers insight on Clearwire investment. Clearwire CEO story

Russian cellular: growth rate down, numbers up

Thu, 19 Jun 2008 06:59:55 -0400

The Russian cellular market grew by just 2.73 per cent in the first quarter of 2008, its second ever lowest increase. However, there was cause for optimism as the rolling annual growth rate increased from 13.9 per cent for the year to 31st December 2007 to 15.6 per cent for the year to 31st March 2008. Net additions for the year were 22.69 million, the highest total since 2006. At the end of the first quarter the total size of the Russian cellular market was 167.7 million, giving the country a penetration rate of 118 per cent, up from 115 per cent at the end of 2007. The bulk of Russian cellular customers are accounted for by three operators, MTS, Vimpelcom and MegaFon, who between them have 82.9 per cent of the market. The major winner over the year was third-placed MegaFon which recorded customer growth of 19.7 per cent over the year.

For more on this story:
- go to Cellular News

Related stories:
Russia's MTS first with commercial 3G service. Article

Intel chairman urges Russian President to go WiMAX

Mon, 09 Jun 2008 06:59:56 -0400

Not willing to let up on its campaign to see WiMAX become a widescale success, Intel's chairman, Craig Barrett, is reported to be planning to meet with the Russian President Dmitry Medvedev and other government officials in an effort to open the door to WiMAX.

Intal is said to have become frustrated at the lack of progress following the signing last year of a WiMAX co-development agreement with the Russian telco Comstar. The joint effort targeted a city-wide mobile WiMAX network in Moscow, but government allocation of frequencies has been an obstacle to implementation, Barrett said. If negotiations are successful, Intel hopes to launch a WiMAX network in Russia by the end of the year.

Regardless of this high-level lobbying, the Russian telco Enforta has announced plans to expanding its WiMAX network to cover another 22 cities this month, bringing the total to 55--but excluding Moscow.

For more on this story:
- read EE Times and Telegeography

Related stories:
Virgin Group enters WiMAX business in Russia. Virgin WiMAX story
Russia's MTS first with commercial 3G service. MTS 3G story

Leading content provider signs revenue share deal with Nokia

Thu, 05 Jun 2008 06:59:55 -0400

Pushing forward with its strategy to increase its revenues from mobile services has seen Nokia sign a revenue-sharing deal with Buongiorno, the world's largest mobile content provider. Nokia will provide Buongiorno with a dedicated channel within Nokia's Download! on-device portal, with the two companies sharing revenues from any content sold via this route.

While Nokia users in Italy will be the first to have access to the content, the companies said they also plan to make the content accessible in markets including Spain, France, Brazil, the U.S., China and Russia, but did not specify dates.

For more on this story:
- read Mobile Entertainment and MoneyAM

Related stories:
Buongiorno buys iTouch for US$191.7M. Buongiorno story
Nokia sweet-talks operators over revenue share concerns. Nokia story

Roamers outside Europe hit by price hike

Mon, 02 Jun 2008 06:59:57 -0400

The enforced cut in roaming fees imposed on European operators by the EU has seen roaming calls into Europe increased by a massive 163 per cent. Operators are said to have lifted call tariffs in an attempt to offset the losses from roaming charges within Europe.

According to Informa analyst Angela Stainthorpe, since the EU roaming regulation came into force, operators have reported roaming revenue declines into the hundreds of millions of Euros. "As roaming traffic growth hasn't kept up with falling tariffs, operators are looking elsewhere to recoup their losses.

For example, said Stainthorpe, the average price of a call home to Italy made by a subscriber roaming in Russia was €3.67 (excluding VAT) per minute in 2006 but had risen 25 per cent to €4.58 since the Eurotariff came into play. A German mobile user outside the EU has seen a massive 163.7 per cent price increase since 2006 for a call home from Africa.

For more on this story:
read Telecoms.com

Related stories:
EU launches inquiry into mobile data roaming fees. Roaming fees story
European roaming charges falling--official. Roaming charges story

Russia's MTS first with commercial 3G service

Thu, 29 May 2008 06:59:56 -0400

The Russian operator Mobile TeleSystems (MTS) has become the first to switch on a commercial 3G network following the launch of the service this week in St Petersburg. The company plans to launch additional 3G networks in over 10 cities during 2008 and in up to 40 cities in Russia through 2009.

The company claims it will invest US$1.6 billion in deploying the network over the next three years to provide services, such as video calls, mobile TV and mobile broadband, to subscribers in Russia and the CIS.

The company said it had only invested five per cent of the overall investment, but expected to generate additional revenue of US$2.5 billion from 3G services, including US$2 billion in Russia by 2011. Mikhail Shamolin, CEO of MTS Russia stated: "We believe that conditions for the 3G launch in Russia are more favorable than in the developed markets. Today's HSPA-enabled infrastructure allows download speeds up to 10 times faster than the first phase of 3G networks, while the costs for equipment and devices are significantly cheaper."

For more on this story:
- read Telecoms.com

Related stories:
Russia's MTS bids US$1B for regional operator. MTS Story
MTS to purchase Russia largest cell phone retailer. MTS story

Russia's MegaFon mulls €3bn Iranian venture

Thu, 15 May 2008 06:59:56 -0400

MegaFon, Russia's third largest cellular operator, has said it is prepared to build a GSM network costing €3 billion in Iran if it obtains a cellular licence. The company, which has only just opened an office in Tehran, said that it was considering a long-term investment in the Iranian market which already has two established operators--Iran Telecommunication and South African-based MTN.

According to MegaFon's director general, Sergei Soldatenkov, if the company is granted a licence, then MegaFon International is ready to invest. "We consider the Iranian market sufficiently attractive for the development of mobile communications. Iran is ahead of Russia in terms of population growth, while its economy is sufficiently stable."

MegaFon itself has been the subject of interest this week with Russian billionaire Alisher Usmanov acquiring a near 40 per cent holding in the company, which is part owned by TeliaSonera (rumoured to be in France Telecom's sights) and the private equity vehicle Alfa Group.

For more on this story:
-read this story

Related story:
Russian telcos look to Asia for growth. Russian story