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Russian mobile VAS market reached 55 bln rubles ($1.681 bln) in 1H09

Posted August 14th, 2009 by Anton Veremyanin
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J'son & Partners Consulting presents the key results of conducted research includes analysis of current situation and regions (America, Europe and Asia), a detailed review of mobile the further market development. The research contains the analysis of such mobile VAS as SMS, transfer, mobile commerce, mobile marketing and mobile TV.

Size and structure of Russian mobile VAS market

J'son & Partners Consulting estimates the volume of the mobile VAS market in Russia at 94 bln RUR (3.8 bln USD) in 2008, and at 55 bln RUR ($1.681 bln; at average currency rate 32,71 rubles per 1 US dollar) in the 1st half of 2009.

Most part of revenues from mobile VAS as well as from core services, is generated by operators of the «Big 3»: MTS, VimpelCom and MegaFon (83.3% in the first half of 2009).

Short message service (SMS) remains the main driver of revenues (the share of the revenue exceeds 50%). Content services (including mobile commerce) and mobile data transfer account for almost equal proportions: 22.6% and 22.6% respectively.

Source: J'son & Partners Consulting

Forecast of the Russian mobile VAS market size

Due to socio-economic situation (reduction of effective demand and devaluation of ruble at the end of 2008 in context of nearly constant ruble tariffs for VAS), in 2009 the mobile VAS market is expected to fall in dollar terms to 2.95 bln USD, along with growth in ruble terms of 4% (according to the realistic scenario).

Source: J'son & Partners Consulting

Major negative trends in the Russian mobile VAS market can be summarized as follows:

1. Stagnation of mobile content segment was caused, first of all, by decrease in ringtone and paid video content sales (which is still covered by the growth of revenue generated by RBT service). This in turn is caused by increased awareness level of subscribers, by rapid growth of the handsets functionality, which provide advanced features to search for audio and video content in the Internet, as well as by insufficiently thought out policy of right holders.

2. Slowdown in growth of revenues from RBT service. Primarily this is caused by a scarce RBT content base, rundown potential of the applied promotion methods (*Some melody instead of usual beeps») with a complicated procedure for selecting the needed melody.

On the other hand, a number of mobile VAS market segments continue to evolve:

  • Mobile commerce. This service is closely connected with Internet-services market as one of the main payment systems. Internet traffic, despite of the crisis, is constantly growing, that means an additional demand in the segment of mobile micropayments.

  • Mobile data transfer. This service is in demand in the regions where wireless access is often the only option for Internet access.

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