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Rating of Ukrainian operators of mobile Internet by the end of Q4 2014

4 years ago

2166 words

E&C consulting group (www.encint.com), interviewed the key market participants and prepared the rating of operators of mobile Internet in Ukraine in the fourth quarter of 2013. Compared with the previous rating the significant changes in the positions of the players did not happen: the top three operators of mobile Internet, as before, led by three largest GSM-operators in Ukraine. Kyivstar remains the leader, mobile Internet user base of this company during the period was more than 11 million subscribers.

According to «E&C» estimation (www.encint.com), the integral rating* of mobile Internet operators in the 4-th quarter of 2013 by the subscriber base was as follows:

Position

Operator

Subbscribers (thousand)

1

Kyivstar

11 300,0
2

MTS

6 067,0
3

life:)

4 469,0
4

Intertelecom

1 075,7
5

PeopleNet

909,0
6

Trimob

494,1

* Rating is are estimates. E&C (www.encint.com) reserves the right to revise the indicators of this rating.
The results of previous ratings can be found here: 1st quarter 2013, 3rd quarter 2013.

Vyacheslav Dzhulai, manager of data services in Kyivstar

Vyacheslav Dzhulai, manager of data services in KyivstarKyivstar leads in the number of mobile Internet users, due to successful marketing messages, improving service quality and increasing number of “smart devices” in the network. In 2013, we made a “revolution” in the mobile internet tariffs, abolishing fees for megabytes in the vast majority of prepaid plans. As a result, we have seen an explosive growth in consumption data traffic – 50 % compared with 2012. In 2013, the number of smart phones in the network of Kyivstar increased by 44%.

Consumption growth of mobile Internet stimulates the development of various services based on this service, such as mobile applications for reading, mobile health (mHealth), electronic payments and mobile commerce. For example, Kyivstar in 2013 introduced a number of unique applications for smartphones and tablet with IOS and Android operating systems. This application for the prevention of eyesight “Dobre Baciu” (Good Eyesight), application for teaching children to swim and others. In 2013, “medical” applications were installed by more than 40,000 subscribers. Our company is also the first among mobile operators began to develop a line of mobile commerce by launching innovative service “Mobile Money”. Subscribers (Internet users) were able to make payments with their mobile phones for a variety of services and products by using the funds on means SIM-card. There are more than 75 000 of suc clients, and the during year they made over 300,000 transactions. Reading literature with mobile phones is very successfull too with our service Smart Kyivstar, which we launched in 2013. During the year about 32 thousand users became active readers of mobile virtual library that already has over a thousand e-books of various genres.

In 2013, Kyivstar carried out technical works to ensure the stable quality of mobile Internet services. In order to expand the network capacity and improve the quality of mobile communications in 2013 were installed 655 new base stations, more than 16 thousand additional transceivers. Also Kyivstar has successfully implemented all the planned work in 2013 on the modernization of the network, the base stations to transfer IP- transmission, and replacement with a new one which can be used to provide services of 3G/LTE.
In 2014 we will continue to develop proposals for the mobile Internet, multimedia services and mobile applications for smartphones. At the same time, GPRS/EDGE standard which dominates on the telecom market of Ukraine has exhausted its possibilities to provide mobile Internet services. The rapid growth in consumption of mobile data traffic generated says that customers needs higher speeds of mobile Internet than those that can provide GPRS/EDGE. Technically Kyivstar’s network is ready to provide the services on 3G/LTE standard. And if the issue is resolved abut allocation of frequencies for these services, or about using the principle of technological neutrality, our company will be able to quickly provide access to millions of customers to mobile broadband data with the corresponding high-quality service.

Oleg Reshetin, the director of marketing in MTS Ukraine

Oleg Reshetin, the director of marketing in MTS UkraineIn 2014 we expect growth in the number of connected portable devices ( smartphones, tablets) and an increase of mobile penetration by subscribers with multiple SIM-cards and M2M-connections. Now in the world there is a tendency to reduce the volume of the “voice”, which is reflected in the telco’s income. In Ukraine, it is not yet so clearto talk about the impact on revenue. But stabilizing of MOU in our network and a slight decrease during the year indicates a change in the structure of demand in favor of the data services. At the same time, the volume of usage and revenues from data-services grow by an average of 30% per quarter. That increase in the proportion of data-services will in the coming years ensure the growth of industry revenue. So next year we will continue to focus on mobile Internet access – for both private and corporate clients. I think next year there will be significant changes in such areas as e-commerce and mobile payments, and cloud services will become accustomed to a wider range of consumers.

Oksana Rudyuk, head of PR-department of life:)

Oksana Rudyuk, head of PR-department of life:)From our point of view, 2013 was marked for telecom market by seceral spectacular events. One of them is selling of large telecommunications company “Ukrtelecom” owned by SCM. According to decision os Antimonoply Committee of Ukraine the shareholder received full control over the operator, the only in Ukraine who has licensee for the third generation.

The main trend of the market is the growth of consumption of data traffic in the networks of mobile operators. It is origined by more smartphones in the networks and by growing number of mobile Internet users and more attractive marketing offers of mobile Internet access. So, in life:) network as of the end of the fourth quarter of last year, more than a quarter of the active subscriber base (26%) used a smartphone and mobile Internet – almost half of active subscribers of the operator.

In 2013, was a trend of increase of volume in the tariff package proposals, in connection with which there is a correction of their value, and the attention of operators during the formation of tariff proposals shifted toward the “wholesale” when the package is offered at a more attractive price than the individual services. Such proposals are becoming increasingly popular among subscribers. A striking proof of this is the proposal for us “all inclusive”, where for 80 UAH per month life:) offers unlimited communication in network
unlimited internet, 1000 SMS and 300 minutes of voice calls to other operators.

Among important events of 2013 for life:) are the following:
• Strengthening the position of “number one operator for smartphones” and the penetration of smartphones in the life:) network to 26%.
• higher rates of growth of financial and operating performance than the market average: during a year the income of “Astelit” increased by 11%, which is several times more than the revenue growth rate of competitors; annual rate of EBITDA margin exceeded 30%, and active subscriber base increased by 15%.
• launch of the first unlimited tariff plan for individual subscribers in the price range up to 100 hryvnas.

Telecom market froze over the precipice, as in regulatory and market relations. State Statistic Committee in 2013 for the first few years of income recorded a negative trend in mobile telecommunications sector. As a consequence, the share of income from mobile services gradually decreases in total structure of revenue of telecommunications industry. In fact, among the mobile operators which continues steadily grow on the main indicators is life:) only. This is due to two factors – the irrational pricing of our competitors and the general lag of Ukrainian mobile market.

The only service with increasing consumption is mobile internet. From our perspective, this trend will be relevant this year. However, since the actual lack of licenses for new generation ща communication in the market, this trend will gradually weaken. Radical change in the situation we expect in case of a decision on reallocation of frequencies between the operators and the subsequent launch of the principle of technological neutrality in the market that will allow operators to develop technology on frequency resource, which they already use. This could allow the Ukrainians to fully use their smartphone and in general – all the opportunities that can provide mobile communication.

If there is a long-awaited launch of mobile number portability (MNP) services, there will be possible the redistribution of the market. After all, consumers will be able without complexities to change mobile operator while retaining their number, from which it is difficult to refuse for subscribers “with experience”. However, MNP service by itself will not give Ukrainian subscribers the right of full and free choice of mobile service provider, without connectoin with number’s operator: this is because of high rates of interconnect and, as a consequence – the closure of traffic inside the operators network. High tariffs for calls outside the network significantly reduce the effectiveness of MNP subscribers and maintain binding to the operators with their social group. Therefore, the introduction of number portability services, from our point of view, should be carried out in parallel with a significant reduction or even zeroing interconnect rates – this will align the difference between the cost of calls within the network and to other networks and make subscribers less dependent on price differences depending on the destination of the call.

In 2014, life:) will focus its efforts on the services most requested by subscribers. First of all, strengthening the status of the number one smartphone operator and considering dynamically growing number of subscribers to such devices, we will not only create attractive rates with large volumes of mobile Internet, but also user-friendly applications, and other useful features.

Also it is planned to develop services aimed at self-service of subscribers. Today we see that this global trend, especially among young consumers who want to take control of their costs, services, receive service online.

life:) also carefully examining the prospect of mobile payments in the Ukrainian market, and has already made a number of steps towards the launch of service.

Boris Akulov, CEO of «Intertelekom»

Boris Akulov, CEO of "Intertelekom"

Point of growth of the telecommunications market is increasingly shifting towards mobile access, due to the rapid development of high-tech segment devices – tablets and smartphones. Operators stimulate the consumption of mobile Internet through excretion of bundled offerings and joint actions with equipment manufacturers. Penetration of mobile access in turn gives rise to the development of new interesting services.

For us, 2013 was a good one – operator’s subscriber base grew by 19%, significantly higher than the average growth rate. However, if we talk about the market in general, the results of the past year have once again confirmed the obvious fact – without a clear long-term policy of state regulation with most-favored innovations the market can not move forward. Therefore, we believe the key news – the reduced revenues from telecommunications services according to the results of 2013.

The stable socio-political situation in the country, of course, is the determining factor for sustainable development of the market in 2014. I’d like to believe that our country will overcome the difficulties stage. Especially important in this regard to fully exploit the potential of telecom as one of the drivers of economic growth.

Signals that NCCIR industry regulator gives to market inspire cautious optimism that the long-standing problem on issues such as the implementation of the principle of technological neutrality, service number portability and interconnection rate regulation, will find the optimal solution. Even the decision of the aforesaid issues will give the market an additional impetus for development in the next several years.

As for its own plans of Intertelekom, we plan to strengthen the leadership in the wireless broadband, by developing new interesting proposals for two key segments – home subscribers access through a modem connection and rapidly growing segment of users of tablets and smartphones. To simplify the process of subscriber’s connection to network, operator plans to more actively develop the form of connection via starter packs. One of the main goals in 2014 is to preserve, improve the quality and coverage. By the end of 2014 the number of CDMA base stations will increase by 25%.

Source: Expert & Consulting (www.encint.com). Reference to the source and active clickable link is obligatory. Authorship confirmation.