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Stats From The 3rd Russian VAS Conference

Michael Novikov, CEO & founder of ADMIN, has written this report on the 3rd Russian Mobile VAS Conference, which was held in Petersburg last week and saw 370 participants from 19 countries attend.

The Russian mobile content market is expected to reach $450 million in 2006 (from slightly over $300 million in 2005). By November the number of cellular users (SIM cards, to be correct) was 148 million while Russia?s population was 142.3 million people. The share of traditional ringtones, wallpapers and other products for phone customization has been gradually decreasing since 2005 and now accounts for 40% of the entire mobile content revenues. According to Russian market players, WAP and mobile Internet have become valuable drivers for increasing mobile data traffic in 2006.

Russian content providers used to advertise their services (especially ringtones) on TV and in print media, but increasing costs for TV and print ads and decreasing demand for ringtones means the companies are searching for other alternatives. The companies are also diversifying their offerings and expanding abroad to make up revenue. New services like RingBackTones, a variety of IVR services, and m-commerce were introduced to the Russian market, with a number of content providers turning to mobile marketing. In 2006 the mobile marketing revenues will reach $20-25 million in Russia (a widespread figure of $15 million provided by some analysts is underestimated, I think). That is still peanuts comparing to the entire Russian advertisement market (about $5 billion), but the prospects of mobile marketing are very promising. Over the past couple of years the leading telcos, MTS and VimpelCom, reduced the number of companies they did business with forcing smaller providers to go through large aggregators.

Natalia Potapova, product manager at VimpelCom, Beeline brand, gave some stats for their mobile content customers. 60% of the customers download polyphonic melodies/ringtones, 41% games, 32% pictures, 27% realtones, 12% animation, 8% video, 3% themes, books and software.14% once in three months, 26% of respondents download mobile content two/three times a month, 21% once a month, 18% once a week, 16% several times a week, and 4% every day.

Mikhail Zhukov, MegaFon gave the view from the off-portal world: 42.87% users are interested in porn content, 32% in free of charge content, 6.4% in software, 4% in gay/lesbian content.

Igor Shraibman, director of Jump Ukraine, gave some stats for that country. By July 2006 Ukraine had 35.8 million cellular users (75.5% penetration rate), Kyivstar and UMC are the leading cellular operators (44.7% and 42.2% market share) followed by Astelit (11.4%), VimpelCom (1.5%) and Golden Telecom (0.1%). The Ukrainian mobile content market is over $60 million. Kyivstar and UMC are generating 52% (in equal shares) of mobile content revenues followed by content providers: Jump Ukraine (8%), Inform-Mobil (7%), PointCom (6%). i-Free, Solvo and UPT have by 3% of the market share each, Euroinform and Logoton by 2%.

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