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Rating of Ukrainian Operators of Mobile Internet at the Beginning of 2015

2 years ago

2898 words

Consulting group «Expert & Consulting» (www.encint.com) interviewed key market participants and summarized the results of the 4th quarter of 2014. Also “E&C” asked operators to tell about their forecasts for 2015.

Integral rating.

According to the evaluation of “E&C”, integral rating* of operators of mobile access to the Internet at the end of the 4th quarter of 2014 looks like:

* Rating is an estimate. E & C reserves the right to review performance of the ranking. The total score is the sum of the integral ranking equally weighted scores for all categories of operators. Point operator in a particular category – the percentage values ​​of the index of the operator in the category of the maximum value in the same category, rounded to one decimal place. The position of the operator in a particular category – the serial number of points in this category, from largest to smallest. Sources identify indicators companies are data from a survey of operators and / or evaluation of group E & C.
1. Subscriber base – consider the general ( natural and legal persons ) active base (based on the internal accounting system operator ) subscribers.
2. The dynamics of the subscriber base reflects growth period to period.
3. ARPU is calculated blanded ( legal and natural persons ).

The integral rating includes leading Ukrainian providers of mobile Internet in the number of subscribers at the end of the 4th quarter of 2014:


More detailed information is available in the reviews of mobile Internet market www.encint.com/products/telco_products/mobile_internet_vas.

COMMENTS

As part of the rating , the following comments on the development of the market and the major events on it. This rating is also an original result , respectively , we asked the operators to voice their forecasts for 2015 , focusing on possible points of market growth .
We were interested in the opinion of the operators of the adjacent segment of the market WiMAX- internet because we added a comment from “Giraffe”.

Yuriy Nadych, Leading Specialist (mobile internet) at “Kyivstar”
2014 year was the most difficult for the whole period of independence of Ukraine. This could not but affect the business of telecom operators. However, the continued growth of the mobile Internet on the basic parameters. Traffic growth of 58% for the year – due to the attractive price offers, high quality communication and an increase in the number of smart phones on the network. For example, among the customers of the tariff plan “Free Smartphone” more than 90% use mobile internet. “Kyivstar” suggested users of mobile Internet accessible and understandable rates (no hidden charges), net premium quality and reliability of the mobile Internet. The average data rate of EDGE technology in the 4th quarter amounted to about 140 kbit/s. The number of “smart phones” is constantly growing and at the end of December 2014 exceeded 7 million.
Most important event of the year – the competition for the preparation of frequencies for services 3G. Issuance of licenses for frequency “new generation” will attract billions of investments in Ukraine and will be a key driver for the development of the telecom industry in the next few years. New technologies to provide high-speed Internet subscribers up to 42 Mbit/s, the ability to make video calls and high voice quality. The main risks are inflation processes that affect the consumer power of the population of our country, as well as the armed conflict in parts of eastern Ukraine.

Oleg Reshetin, CMO at MTS Ukraine
Итоги 2014 года:
Last year was a year of the greatest challenges posed by external circumstances – first of all, a forced termination of work in the Crimea and events in the east. Despite this, the high stability of the business allowed for the year to get the positive dynamics or to maintain stability in the core financial and operational performance.
The first time this year, data transmission and came in first place on the income from additional services, amounting to more than 36% of income additional services and surpassing traditionally the most profitable SMS-services.
The company has revamped the tariff policy in the field of data communication by making services available to each subscriber. In the past year, “MTS Ukraine” has canceled all MBs charging fees prepaid , has launched attractive tariffs for data transmission , as well as special offers for subscribers not previously used the services of data transmission.
These factors led to a twofold increase in the use of data services . The growth in traffic did not take place due to heavy-users, and due to the greater Internet activity normal users and a significant increase in the number of new Internet users. Thus, the proportion of Internet users among all new subscribers the company reached a record 65 %.
The forecast for 2015:
The growth of consumption and income data from last year even 2G- networks , as well as high unrealized demand for 3G- services in Ukraine can count on the rapid growth of mobile Internet consumption , increase in revenues from data transmission , as well as their share in the overall structure income.
In this year there will be a qualitative transition from one technology to another. Subscribers of ” MTS Ukraine” will be the first to use 3G internet in their smartphones – today due to national roaming with TriMob , and then , with the development of its own network – at even higher speeds in the standard HSPA + in MTS network .
2015 will be very important for operators and subscribers , and for the country as a whole. After the penetration of high-speed mobile Internet – is the fundamental thing that will form the basis and e-government , development of online education and telemedicine in Ukraine. In telecommunications today there is a real chance to become one industry that will attract significant investment into the country.

Dmytriy Furman, Director of Corporate Regulatory and Legal Relations of Mobile Operator at life:)
Top 3 events in the country :
1. The entry into force of certain provisions of the Association Agreement between Ukraine and the EU,
2. The early parliamentary elections,
3. The formation of a new government.
Top 3 market events:
1. The announcement of the 3G- tender,
2. Initiation NCCIR blocking routing of international voice traffic through centers located in Ukraine switch to numbers , codes are allocated to the Russian Federation annexed the Crimea,
3. The appointment of the administrator УГЦР services for migrating mobile numbers.
Top 3 events in the company:
1. +1.1 million new subscribers for the year,
2. joint with Orga Systems victory at World Communication Award 2014 by Total Telecom for the implementation of a complete replacement of infrastructure BSS in the Belarusian operator BeST for 12 months,
3. The actual cessation of work in the Crimea.
Of course, the most anticipated and most significant change in the market – is launching 3G. From our point of view , the new technology will largely determine the trends and the work of operators in 2015. life:) plans to launch a new service to its customers as soon as possible. Previously, we plan to launch 3G in the next six months in the big cities, and thanks to the frequency resource, which we have received, we will have a 3G- network of the best quality. But we firmly believe that today’s auction – this is only the beginning of major changes in the mobile market of Ukraine and its transformation into a transparent, competitive and challenging industry that will attract investors , providing its customers the best and the greatest variety of services, and very soon we will get a chance to be part of expected new innovations that will make the Ukrainian market closer to European standards and more interesting for its investors and consumers.
One such innovation, which we hope to see soon in Ukraine , is the launch of mobile number transfer service (MNP). Of particular importance, it will acquire in connection with the launch of 3G, as it will allow subscribers to choose from on the market all 3G- sentences without changing rooms and binding to the operator. This will stimulate clear and healthy competition in the market, as well as the positive impact on the pricing of services 3G. However, this effect is only possible with the most simple and affordable way to provide services MNP: an appeal to the operator to the recipient without limitation communication channels for this purpose and identification requirements, transfer within a day or less , free for the user services.
Another change that can become a driver in the market and we expect to see in 2015, is the regulation of prices for operators with significant market power (SMP- operators), both for retail and wholesale tariffs. The latest draft law “On Electronic Communications”, adopted NCCIR February 3, 2015 and designed to replace the Law “On Telecommunications”, includes a paragraph on the definition of communication providers with a share of income in excess of 25% for certain telecommunications market, and is defined as SMP the operators. This document also suggests the possibility for the regulator to impose restrictions with respect to such operators, for example, to control rates if necessary. Such an approach is common in Europe. Call termination rate (MTR), calculated on the basis of cost and assumes a certain asymmetry, which reflects the difference in market shares of operators, also meets European standards, and we believe that this asymmetric MTR positive impact on competition by facilitating the arrival of new players in the market.
At the same time, the situation in Ukraine remains fragile and this creates certain business risks. But we sincerely hope that, despite all the difficulties, 2015 will be a landmark year for the Ukrainian telecommunications , a year of serious challenges to its players.

Boris Akulov, CEO “Intertelecom”
The main point of growth for the telecom industry in the current year in the first place should be the introduction of 3G technology in the mobile network operators . To date , it is actually the only global vector of development. Ukraine today remains one of the few countries in Europe where there is no 3G standard in the lead, on the level of penetration in the country, the standard connection . And it was the mobile date is one of the key sources of income mobile operators. However, in 2015, significant changes in the penetration of 3G internet in Ukraine is hardly expected. This is primarily due to the pace of building networks that are only in October – November 2015 will be able to achieve the required coverage for comfortable use 3G internet even within the regional centers.
In addition, among the promising ways to develop the 2015 can distinguish the direction of comprehensive proposals that combine , in addition to packet voice services and Internet traffic , and more value-added services that meet the needs of subscribers in a particular format of traffic consumption.
For perspective growth in the near future also include orientation on the multi – going beyond just providing mobile services and the Internet, as well as the introduction of complex sentences. As an example, the services including the home Wi-Fi, digital television, etc. World experience shows that the format of telecom services consumption has long been preferred for the majority of users and due to convenience fees , and due to savings in batch consumption. In Ukraine, while only some operators are taking steps in this direction.
FORECAST AND POINTS OF GROWTH 2015 : description of the market , trends , threats and opportunities.
1. The growing popularity of online video. World mobile data traffic grew by 81%. Record levels achieved at the expense of video content ( 40% of total traffic). View videos on the recommendations – 38 % of smartphone users are watching videos recommended by friends several times a week . Creating your own video (Loop, Coob, Vine). This trend is confirmed by the internal statistics of ” Intertelekom .” The share of traffic generated by subscribers Intertelekom on video sites increased in total consumption traffic more than tripled over the last year.
2. Development of a segment M2M. Today we can observe the trend of increasing this segment of the total services operators. In view of the high rate of development and making automated self-service customers , attention to M2M services will only grow.
3. Savings and reduced consumption of mobile subscribers . ARPU decline of voice subscribers. Flow of voice traffic in the Internet (mobile instant messengers , social networks).
4. Smooth the digital divide. Increased penetration of smartphones in the low price segment . By reducing the cost of smartphones and greater availability compared to PCs , smartphones melts priority way to access the Internet.
Threats:
The main threat to the telecom industry today can be caused by the difficult economic situation in Ukraine. Impact and reduced purchasing power of the population , and the feeling of uncertainty , and the observed rapid rise in prices for goods and services , including an increase in the rates charged by the telecom industry , which is to be expected in the current year. According to the results there is a risk of decline in ARPU, as subscribers will optimize their costs by refusing to additional costs . This factor may affect the rate of penetration of the third generation.
Top 3 market events:
1. Approved the date , terms and a list of bidders for a 3G license.
2. Ukrainian GSM operators stopped their work in the Crimea.
3. Announced change of partner companies “TriMob” on national 2G roaming c 2015.
Top 3 events in the company Intertelekom:
1. In November, was launched two thousandth of the base station Intertelekom.
2. Development of the project “Wi-Fi in public transport”. Free Wi-Fi is now available to passengers of urban electric cars and in 10 cities of Ukraine.
3. Expansion of the line of unlimited tariff plans in the segment of 3G internet.

Vladislav Yagdzhyev, CTO at TSU PEOPLEnet.
In the 4th quarter in the mass segment PEOPLEnet launched the campaign “Holiday megabytes”. Under the terms of the action users extra bonus packet traffic in the most popular tariff plans “Super Unlimited” and “Unlimited for a day”. The great demand for the subscribers for additional services . For the quarter, the growth of mobile Internet – Traffic 1.5. PEOPLEnet – the first operator that introduced the platform DPI (deep package inspection), which allows subscribers to provide unlimited access to the network and cancel MBs charging.
Given the current economic situation , PEOPLEnet undertook a range of activities to improve the distance form of customer service that saves a lot of time and money subscriber.
Events for the telecom market:
1. In 2014, twice increased the cost for the use of HRD.
2. Change of NCCIR.
3. Tender for 3 G license.
Still the main trend of the company is to provide mobile services in standard CDMA, as well as the development project started to provide fixed broadband access to the Internet , a feature that is to build hybrid networks using radio.
Trends 2015:
An important event of the year will be a welcome reception of 3G licenses in the UMTS standard major players in the telecommunications market. Further development will depend on the actions of regulatory authorities and the economic situation in the country.
Operators of CDMA while able to keep a certain percentage of the Ukrainian market of 3G- services, because the cost of content and quality of CDMA networks will concurrency due to a successful arrangement band.

Taras Kucheriavyi, Marketing Director at Giraffe.
The main outcome of the 4th quarter of the company is synchronous with the main economic trends in the country – reduced solvency of clients outflow in the corporate market , the loss of control of the Donetsk and Lugansk network segment , and as a consequence , the loss of part of the company’s revenues.
The market will grow at the expense of additional services and expansion of the current package of services for existing customers of operators. This will allow operators to somehow justify higher prices for services , which will inevitably happen , and perhaps more than once in 2015.
In terms of price increases a lot , of course, depends on the general economic situation in the country, the policy of the state ( government , NBU, regulators ) and its signal to society. And on a more practical level – the level of inflation , investment, and on the hryvnia exchange rate to the dollar , including , as All telecommunications equipment that is used to provide services to subscribers – import so are the costs of operators , the cost of services. And as a result – there is an inevitable increase in prices for end users.
Due to the fact that in Ukraine, the average revenue per user in the provision of access to the Internet – one of the lowest in the world, and so prices would have to increase as less as they say there’s nowhere . Inflation in the country’s economy will only encourage this process.

Source: Expert & Consulting (www.encint.com). Active link to the transition to the source and the site www.encint.com is required.