Development of Infocommunications Services in Russia

Abstract

We have analyzed the market of infocommunication services in Russia. The number of both mobile Internet users and fixed-line Internet subscribers increased in 2011–2017. In 2017, mobile Internet in Russia was used by 124.83 million people, which is 7.7% higher than in 2016, and 47.7% higher than in 2011; 93% of mobile Internet subscribers are users of broadband Internet access with a declared speed of 256 Kbps. However, even though mobile operators still have large revenues from mobile communications, no serious revenue increase can be reported in the sector. For this reason, Russian telecom companies are beginning to follow the path of digital development, namely, developing financial services, system integration, e-commerce and the Internet of things. Active development of this line of business in the near future will lead to a decrease in the share of telecom services in the revenues, but mobile operators will not suffer much as the decrease will be offset by revenue from new activities. Analysis of the status and specifics of the telecom services market has revealed two issues that merit more detailed consideration: (1) finding the capacity of the telecom services market; (2) forecasting the number of mobile Internet users. An existing method for determining the market capacity is an estimate that takes into account the purchasing activity and the level of demand. For the info-communication market, this is the volume of all expected purchases, namely, the charges for using cellular communication, the Internet and the like for a specific audience for the billing period, for example, one year. We have calculated three types of market capacity using the example of the mobile operator MegaFon: the potential, the available and the actual. The estimation of market capacity was performed taking into account the number of consumers of cellular communication services, the average number of services for data transmission per one subscriber and the average cost of one service for a subscriber. The potential of the market (the difference between the potential and available capacity) allows to determine the growth potential. The given data indicate that the telecommunication market is exhausting itself. In order to be successful in the market, the cellular operators need to expand their business by seeking new directions for development. The Gompertz curve was used to determine the predicted number of mobile Internet users. The graph has an S-shape. The number of subscribers is limited. The number is approaching 137 million people. The forecast was carried out up to 2030. Thus, the stage of saturation takes place at present and the Russian market of infocommunications (in terms of the number of subscribers) has already significantly slowed down its growth. Providing high-speed broadband Internet access, fourth (4G) and then fifth (5G) generation mobile communication and introducing digital services can be considered as a strategic objective.