Major Tendencies of the Russian Mobile Material Market place (2006-2007)
The Russian VAS Current market in 2006-2007
In parallel with the Web universe the Russian mobile planet is rising fast. In 2006 the Russian value-included expert services (VAS) marketplace produced steadily, and ongoing its development in 1Q 2007, reaching USD 615 million, a 34% 12 months-on-yr progress, noted ComNews Exploration. All three important gamers of the VAS sector, operators, articles vendors (CP) and aggregators, as properly as subscribers are rising with it. Important Russian cell operators released a lot more aggressive and assertive policies in the VAS scene, launching new WAP-portals and solutions and severely decreasing the amount of written content partners. The VAS share in operators’ overall revenue composition attained 14% in 1Q 2007. With the launch of the initially 3G networks in 2007-2008, Russian operators will only improve their articles featuring. Consolidation and stricter plan by operators cut the range of main material vendors to 80-100 organizations. Final calendar year CPs honed their techniques in giving IVR and RBT solutions, pushing for a lot more video clip written content, cell video games and community expert services.
Significant CPs pushed for improved good quality material presenting, introduction of new products and solutions and international current market expansion. Right now the winning system of the Russian VAS current market is making sure content good quality and diversification of products and solutions and services. IVR, SMS-primarily based Tv set lotteries, RBT and cellular games starred in the most well-known and productive articles products and services area. IVR solutions caught the “Lady Luck” of revenues in 2006. On top of that, continuous WAP penetration growth, cellular community services and consumer-created articles all promised that this yr will be positive.
Nevertheless, the in any other case resurgent market place has its pinch of salt. Piracy is on the rise, whilst reduced material high-quality and SMS-spam remained a important impediment to the market’s faster development. Eventually, remaining large WAP-targeted traffic fees and operators’ high income shares provide as the more burden to the marketplace evolution.
What is the Title of the Video game?
Pavel Roitberg, Head of Division of Products and solutions and Products and services, MTS, noted at the very last Cellular Content material Forum held in Moscow in June 2007 that “we have transformed the guidelines of the match.” When ahead of MTS, the largest Russian cellular operator, experienced 250-300 articles companions, the analysis confirmed that 70% of all revenues arrive from 15 key partners, 20% from 20 CPs and 10% from 35 associates. As a end result, MTS ceased contracts with ineffective partners, hence slicing their total spouse range to about 100 corporations. And this is pretty substantially the exact situation for its rivals, VimpelCom and MegaFon.
Reduced good quality of information, as well as an abundance of fraudulent delivers, diminished subscribers’ rely on in CPs and resulted in a sharp fall of articles gross sales in 2005. Understanding from that detrimental working experience, important operators and content material providers rushed to ensure the much better top quality of cellular content. For case in point, MTS made a content material high quality command software making its companions instantly responsible for the content excellent. At the exact time, main Russian CPs established an affiliation to handle mobile content material choices.
In 2006 the income of “significant” and costly material grew even further, as subscribers bought a lot more familiar with online video, video games, application apps and full mp3 tracks. Subscribers’ paying for ability in main urban areas improved, and they are glad spending far more money for ‘heavy” articles. A apparent trend of 2006 is the resurgence of operators’ functions in the VAS market. Various Russian cellular operators made and promoted their own portals, and took section in joint promotion with some greatest material suppliers. Additionally, operators introduced new billing procedures, these types of as WAP-tariff: MT-charge and WAP-click.
WAP Nets Increase Further
iKS-Consulting approximated an regular month to month WAP-viewers in Russia at 14 million consumers. An typical user is male (65%) in the 17-23 age team (60%), claims WAPStart investigate. The maximum development fees for new subscribers are in the outlying locations. 71% of subscribers browse WAP by way of pre-set up mobile browsers. In April 2006, there ended up around 80,000 Cyrillic WAP-web sites. On the other hand, only about 20 WAP-web pages have huge daily audience.
Below is the Prime-5 of WAP-queries in May 2007:
1. Porno – 42.00%
2. Totally free Stuff — 29.49%
3. Computer software (ICQ, jimm, Opera, AV Packages) – 7.23%
4. Gays – 2.75%
5. Mail.ru – 2.65%
MTS has been amongst the most lively cell operators establishing the VAS market. It introduced a new effectively-developed WAP-portal and streamlined its cooperation with information providers, facilitating the material aggregation market. MTS’ direct competitor and Russia’s variety 2 operator, VimpelCom (“BeeLine”), started prosperous voice-CPA and WAP-CPA plans.
In 2006 main mobile written content suppliers drastically diversified their products and services and continued their expansion to the neighboring CIS current market, as perfectly as globally, these kinds of as INFON (Belarus), InformMobil (Tajikistan, Georgia and Kazakhstan), i-Totally free (Brazil and India) and PlayFon (South Africa, Germany, Latvia, Lithuania, Estonia). Other material providers, this sort of as A1 and Interactivi honed their skills in cell internet marketing and intellectual branded solutions. For illustration, A1 actively enhanced key FMCG brands in Russia and introduced its new Java-based cellular community solutions “Ogloblya.” In the same way, Interactivi documented that in the course of 2006 the company worked with some 1 million subscribers in Russia and structured above 60 productive marketing activities.
There ended up modifications in marketing techniques as well. Many CPs admitted that Television advertisement effectiveness is diminishing, although selling prices for placing an ad are skyrocketing. As a result, several CPs shifted their advertisement budgets to the WAP spot and B2B partnership growth. Still some CPs however count on Television advertising and marketing, for instance, Nikita Cell was on the 13th spot in the Top-100 key advertisers list in 2006.
Irrespective of the steady advancement of the mobile material market place, several difficulties remained unresolved. A person of the most popular was the deficiency of imaginative information and services. In general, small material good quality and a lack of schooling among the subscribers substantially lessened speedier industry acquire-up. For illustration, small excellent SMS-dependent Television set contests undermined subscribers’ belief: in several situations subscribers acquired a excellent total of SMS-spam. On top of that, numerous marketplace analysts observed that mobile operators’ revenue share was far too high, and that resulted in an increase of the content price. In addition, higher WAP-site visitors expenditures added to the burden of progressively costly “heavy” information to cellular subscribers.
All About XXX: Mobile Games Product sales Established to Improve
Some 15 million copies of cellular video games were being sold in 2006, estimated Playmobile. Cellular video games are perceived by many current market analysts and players as becoming between the long run income creating giants. The adult and manufacturer games produced the most gains, and will stay popular in 2007, explained DDM in its cell activity analysis. Erotic games produced pretty much 50% of revenues, although brand name video games accounted for 20%-40% of revenues adopted by everyday online games. Among other probably exciting products and solutions are multiple participant game titles, advertisement online games and Pc-title video games.
Best-3 mobile game developers:
Shamrock Video games
Leading-3 Russian mobile sport publishers:
Cell Written content Manufacturing facility
Leading-5 Russian cell video game distributors:
Mobile games — main sectors:
Relaxed video games
Grownup video games
Source: DDM, #1 2007
Dynamic VAS Quarter
In the to start with quarter of 2007 the market continued its dynamic progress. According to ComNews Investigate, during this period of time Russian VAS marketplace totaled USD 615 million, which is a 3% boost about 4Q 2006, and 34% 12 months-on-12 months advancement. The VAS share in operators’ all round income construction attained 14%.
ComNews Investigate emphasized the increasing acceptance of WAP providers, as very well as ongoing progress of prices for the end consumers. The two sides blamed each individual other for the increase in price tag: operators think that the problem lies in the inability of CPs to develop significant and high quality written content, although CPs imagine that operators have oversized earnings share.
20% of operators’ revenues arrived from the VAS section. The full framework of VAS revenues (gross) was as follows:
Foundation products and services – 6% (USD 36 million)
Content material – 20% (USD 124 million)
M-Net – 20% (USD 123 million)
Messaging – 54% (USD 332 million)
Resource: ComNews Study
In 1Q 2007, cellular World-wide-web brought some USD 123 million to operators, just about matching mobile content revenues (USD124 million). The key trends of 1Q 2007 are pretty much related to the types in 1Q 2006. Revenues from customization expert services are falling, whilst IVR and RBT proceed to be on-desire. Other fresh new segments are group expert services and m-commerce. As a result, i-Cost-free noted of prosperous start of its Jamango, a mobile group portal, in a amount of global markets, like India and Singapore. Other developments incorporate, cellular mobile phone customization at the generation phase and attractiveness of SMS-based contest know-how.
Nevertheless, information operators can no more time overlook the new craze: energetic promotion of operators’ personal portals. Their income considerably greater to almost 35%.
Common income share structure involving CP and operator in 1Q 2007 was 61% and 39% respectively, reported ComNews Research.
Cellular content income composition:
Customization – 34%
M-Commerce – 3%
Games – 14%
Infotainment – 16%
Chat/Local community – 9%
M-Advertising and marketing – 6%
Media Jobs – 18%
Off-portal product sales prevailed about portal, with 65% and 35% share of the current market, respectively.
How does the long run glimpse? In accordance to Playmobile, the expansion of brand and erotic online games sales will continue in 2007. The business approximated that some 25 million copies will be offered this yr. Various job player game titles and Computer system-titles online games will raise. However, ComNews Analysis predicts that in 2007 the cell information market place will increase only 16% and reach USD 520 million. To maintain their revenues, CPs will have to think of diversification of their small business, relocating in direction of company enterprise areas.