Record New Connections in Russia

Advanced Communications & Media (AC&M) has reported that November 2004 brought record high net additions in Russia (3.8 million). It seems this year operators decided to start Christmas campaign in advance. This could pay off as this Christmas promises to generate absolute maximum number of cellular additions in Russia ever.

Moscow passed 90% penetration mark. Vimpelcom grabbed more than half of total November net adds in the capital and came very close to its major competitor - MTS. The company announced that it had completely resolved numbering capacity issue and switched to its original 6-month churn period for pre-paid customers (up from 4 months introduced in June 2004). That translated in stronger than usual net additions for Vimpelcom in November.

MTS was number one in net sales in St.Petersburg, while Vimpelcom led (for 9 months in a row) in regional net additions as well as in total Russia additions.

MTS closed acquisition of Sibintertelecom - the monopoly GSM operator in Chita region. That brought in additional ~100k into MTS' regional subscriber base. The deal on acquisition of Horizont-RT (~100k subs) - another monopoly operator in Yakutia - is under way. We find these acquisitions very attractive - although MTS already had already secured license for the entire Far East, through the said acquisitions it managed to access premium subscriber base (thus getting critical advantage vis-a-vis future competition in these regions).

Quite by coincidence it turned out that in November Ukraine became an arena for both intensive political clashes and fierce competition between the rival GSM operators who rushed to capitalize on unprecedented subscriber growth. As of November 30, 2004 there were 12.2 million subscribers or 26% penetration. In November MTS (UMC) returned leadership in net additions - 372k vs. 348k of its major rival Kiyvstar.

MTS continues to lead in Belarus and Uzbekistan both by market share and net additions."

Posted to the site on 7th December 2004