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Kazakhstan - Chance of 100% by the End of the Year
The penetration rate in the Kazakh mobile market is rapidly catching up with that in Russia, with another 6pp being added in Q2 08. At the end of June the total reached 89%, almost 30pp up on the rate recorded 12 months earlier. In absolute terms this translated to a total connection base of 13.65m at the end of the second quarter, up 0.93m from 12.72m at the end of the first.
Even with the slowing growth the market is now experiencing, by the end of 2008 we expect Kazakhstan to get close to the 15.37m customer total necessary for a penetration rate of 100%. Any which way, there is no doubt that Kazakhstan will become the Russia and Central Asia regionĂ' second market to cross the 100% barrier, its nearest rival being Armenia, which finished Q2 08 with an ownership rate of 72.3%.
FinturĂ's GSM Kazakhstan has led the way over the last 12 months, adding 2.41m of the 4.49m new connections, boosting its market share from 48.8% to 50.4%. However, its customer growth rate fell to a six-quarter low of 6.3% in Q2 08, from 7.6% in the preceding period. Benefiting was VimpelcomĂ's KarTel, whose own rate increased from 3.8% to 6.7%, taking its customer base over the 5m mark to 5.098m - 74% of the 6.883m total registered by its larger rival. However, KarTelĂ's 34.6% share of the quarterĂ's net additions still failed to match up to its March-end market share of 37.6%, which caused a small decline in its market share position to 37.4% at the end of June - a 4.7pp decline year on year.
With declines at both of the large operators in the market, the winner in the quarter was Kazakh TelecomĂ's Mobile Telecom Service, which markets its services as "Neo-N". This launched a GSM network in February 2007 has grown to achieve a total of over 0.8m connections in less than 18 months, maintaining a growth rate of over 20% in Q2 08. Most importantly, Neo-N overtook CDMA operator ALTEL (trading under the Dalacom and Pathword brands) for third place in the market in the quarter, ending with a total number of connections just ahead of its 14-year-old rival. As a result, both of the smaller operators finished Q2 08 with a market share of around 6.1%, ALTELĂ's down from 6.7% a year earlier and Neo-NĂ's up from 2.4%.
Posted to the site on 17th September 2008
This article was extracted from The Mobile World Briefing, the weekly newsletter from The Mobile World.
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