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07
Jul

50 mln Cellular Subscribers? Not yet...

Subscriber additions totaled 2.6 mln in June bringing the number of cellular users to 49.5 mln. The country's penetration stands at 34% - twice as high compared to June 2003.

Penetration in Moscow increased to 79% mainly thanks to aggressive sales by MTS that enlisted about 270,000 new subscribers. MegaFon signed up 23,000 customers in Moscow while Vimpelcom for the first time in its history recorded negative (!) subscriber additions in Moscow region due to the numbering capacity constraints well predicted by the company's management.

MTS also posted impressive growth in St.Petersburg getting the largest stake of net adds while Vimpelcom signed the largest number of customers in the regions outside Moscow and St.Pete.

Russian Mobile Subscribers

Mobile Subscribers June 30, 2004 May 31, 2004
Russia 49,470,000 46,890,000
  Penetration 34.1% 32.3%
Moscow 13,397,720 13,138,560
  Penetration 78.9% 77.4%
St.Petersburg 4,425,304 4,243,854
  Penetration 69.8% 66.9%
Russian Cellular
Market Breakdown, June 2004
Russian Net Additions,
June 2004

In June Vimpelcom entered Far Eastern market, the only Russian macro-region where it had no operations, after closing the long-anticipated acquisition of Dal Telecom International. We included DTI's subscribers (322,000 as of June 30, 2004) in Vimpelcom's numbers presented below. DTI acqusition combined with greenfield rollout made Vimpelcom the leader in terms of regional expansion - it has networks in 66 regions as of 7 June 2004 (MTS has 65 and MegaFon has 63).

The position of DTI in our Top 10 is now taken by Skylink - a new holding company with ambitious plans to build pan-Russian CDMA-2000 network in 450 MHz band. So far we have included Moscow (MCC) and St.Petersburg (Delta Telecom) NMT and CDMA operations in Skylink results but plan to expand the list as the holding consolidates other companies under Skylink umbrella. At the moment only MCC and Delta operate under Skylink brand; Uralwestcom (Ekaterinburg) and SONET (Moscow) are to be merged into Skylink shortly.

MTS signed an agreement with Dalsvyaz (PSTN incumbent operator) to purchase 50% of Primtelefon, GSM license holder for the Far East area where MTS already owns 50% stake. With this move MTS decreased its Russian unconsolidated subscribers from 200,000 to only 11,000. Remaining unconsolidated companies are Volgograd Mobile and Astrakhan Mobile. MTS holds 50% in both operators.

Top 10 Mobile Operators

# Company June 30, 2004 May 31, 2004
1 MTS 23,534,000 22,180,400
Moscow
6,120,000 5,850,000
Ukraine (UMC)
4,634,000 4,360,000
Belarus
744,700 688,800
2 Vimpelcom 16,300,000 15,053,000
Moscow
6,183,000 6,185,000
3 MegaFon 9,046,320 8,592,155
Moscow
1,035,405 1,012,560
Tajikistan
24,180 23,100
4 Uralsvyazinform 1,492,600 1,457,600
5 SMARTS Group 1,410,000 1,346,000
6 Sibirtelecom 677,800 662,800
7 N.Novgorod Cellular 451,834 445,636
8 Ekaterinburg Cellular Communications 294,231 285,052
9 Skylink 183,550 180,700
10 New Telephone Company 160,886 160,915

Moscow and St.Petersburg

Moscow License Area

Moscow Market Breakdown
June 30, 2004
Net Additions in Moscow,
June 2004

St.Petersburg and Leningrad Region

St. Petersburg Market Breakdown
June 30, 2004
Net Additions in St.Petersburg
June 2004
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03
Jun

May Heats Up Summer Sales

Total number of subscriber increased by 2.47 mln to 46.89 mln users as of May 31, 2004. Cellular penetration grew 1.7% in May to 32.3%. The results are slightly better than in April when total net sales accounted for 2.12 mln, which is hardly surprising as May is known for summer season wake-up sales.

One year ago (in May 2003) there was a 1.27 mln subscriber increase with penetration in Russia of 16.2%.

MTS was by far number one in the subscriber additions race in Moscow, while MegaFon managed to gain the net sales leadership in St.Petersburg. Vimpelcom was best seller in regions. As of May 31, 2004 cellular penetration in Moscow was at 77.4%, St.Petersburg - 66.9% and the rest of Russia - 24.2%.

Russian Mobile Subscribers

Mobile Subscribers May 31, 2004 Apr 30, 2004
Russia 46,890,000 44,420,000
  Penetration 32.3% 30.6%
Moscow 13,138,560 12,813,564
  Penetration 77.4% 75.4%
St.Petersburg 4,243,854 4,066,771
  Penetration 66.9% 64.1%
Russian Cellular
Market Breakdown, May 2004
Russian Net Additions,
May 2004
Top 10 Mobile Operators
# Company May 31, 2004 April 30, 2004
1 MTS 22,180,400 21,000,514
Moscow
5,850,000 5,605,849
Ukraine (UMC)
4,360,000 4,103,798
Belarus
688,800 636,000
2 Vimpelcom 15,053,000 14,125,000
Moscow
6,220,000 6,150,000
3 MegaFon 8,592,155 8,128,165
Moscow
1,012,560 1,002,315
Tajikistan
25,800 22,297
4 Uralsvyazinform 1,457,600 1,395,389
5 SMARTS Group 1,346,000 1,317,000
6 Sibirtelecom 662,800 604,700
7 N.Novgorod Cellular 445,636 437,798
8 Dal Telecom International 295,713 276,448
9 Ekaterinburg Cellular Communications 285,052 276,189
10 New Telephone Company 160,915 160,714

Moscow and St.Petersburg

Moscow License Area

Moscow Market Breakdown
May 31, 2004
Net Additions in Moscow,
May 2004

St.Petersburg and Leningrad Region

St. Petersburg Market Breakdown
May 31, 2004
Net Additions in St.Petersburg
May 2004
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14
May

Number of Cellular Users Up 5% in April

April is historically on par or weaker than March in terms of cellular sales. The total net adds in Russia were 2.1 mln vs. 2.4 mln a month ago (1.1 mln a year ago in April 2003). The penetration in the country surpassed 30%, a twofold increase Y-o-Y.

MTS outperformed competitors in Moscow area while Vimpelcom demonstrated the best performance in regional sales. MegaFon's final steps to 'clean' the subscriber base by introducing stricter churn policies in its subsidiaries across Russia resulted in rather weak performance in April, though the company's additions in Moscow were stable with subscriber base exceeding 1 mln in the capital as of April 30.

Russian Mobile Subscribers

Mobile Subscribers Apr 30, 2004 Mar 31, 2004
Russia 44,420,000 42,260,000
  Penetration 30.6% 29.1%
Moscow 12,813,564 12,424,223
  Penetration 75.4% 73.1%
St.Petersburg 4,066,771 3,931,481
  Penetration 64.1% 62.0%
Russian Cellular
Market Breakdown, April 2004
Russian Net Additions,
April 2004
Top 10 Mobile Operators
# Company April 30, 2004 March 31, 2004
1 MTS 21,000,514 19,950,000
Moscow
5,605,849 5,390,000
Ukraine (UMC)
4,103,798 3,849,000
Belarus
636,000 593,000
2 Vimpelcom 14,125,000 13,348,000
Moscow
6,150,000 6,034,000
3 MegaFon 8,128,165 7,741,730
Moscow
1,002,315 942,377
Tajikistan
16,500 16,000
4 Uralsvyazinform 1,395,389 1,338,811
5 SMARTS Group 1,317,000 1,265,000
6 Sibirtelecom 604,700 599,800
7 N.Novgorod Cellular 437,798 430,981
8 Dal Telecom International 276,448 258,411
9 Ekaterinburg Cellular Communications 276,189 265,137
10 New Telephone Company 160,714 153,895

Moscow and St.Petersburg

Moscow License Area

MTS leapfroged over Vimpelcom in April winning 55% of all net additions. Vimpelcom still remains the leader with 6.15 mln subscribers leading by 0.5 mln users compared to its main rival, MTS. MegaFon finally reached 1 mln milestone in Moscow earning visible 18% of new users.

Moscow Market Breakdown
April 30, 2004
Net Additions in Moscow,
April 2004

St.Petersburg and Leningrad Region

St. Petersburg Market Breakdown
April 31, 2004
Net Additions in St.Petersburg
April 2004
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06
Apr

More Than 6 Million Cellular Users Joined Cellular Networks in 1Q 2004

March 2004 was succesful for Russian cellular companies. The total number of cellular users in Russia grew by 2.38 mln.

We berlieve there will be more than 60 mln cellular subscribers in the country by year-end 2004.

Russian Mobile Subscribers

Mobile Subscribers Mar 31, 2004 Feb 29, 2004
Russia 42,260,000 39,880,000
  Penetration 29.1% 27.5%
Moscow 12,424,223 12,052,148
  Penetration 73.1% 71.0%
St.Petersburg 3,931,481 3,762,237
  Penetration 62.0% 59.3%
Russian Cellular
Market Breakdown, March 2004
Russian Net Additions,
March 2004
Top 10 Mobile Operators
# Company March 31, 2004 February 29, 2004
1 MTS 19,950,000 18,945,000
Moscow
5,390,000 5,200,000
Ukraine (UMC)
3,849,000 3,652,415
Belarus
593,000 549,348
2 Vimpelcom 13,348,000 12,549,000
Moscow
6,034,000 5,909,000
3 MegaFon 7,741,730 7,163,222
Moscow
942,377 888,148
Tajikistan
16,000 15,294
4 Uralsvyazinform 1,338,811 1,201,800
5 SMARTS Group 1,265,000 1,195,000
6 Sibirtelecom 599,800 574,700
7 N.Novgorod Cellular 430,981 415,383
8 Ekaterinburg Cellular Communications 265,137 245,944
9 Dal Telecom International 258,411 236,122
10 New Telephone Company 153,895 167,728

Moscow and St.Petersburg

Moscow License Area

Moscow Market Breakdown
March 31, 2004
Net Additions in Moscow,
March 2004

St.Petersburg and Leningrad Region

St. Petersburg Market Breakdown
March 31, 2004
Net Additions in St.Petersburg
March 2004
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04
Mar

Cellular Subs Almost Doubled During Last 12 Months

Russia now have more than 40 mln mobile subscribers. The number almost doubled during last 12 months since the country passed 20 mln milestone in February 2003.

Russian Mobile Subscribers

Mobile Subscribers Feb 29, 2004 Jan 31, 2004
Russia 39,880,000 37,960,000
  Penetration 27.5% 26.1%
Moscow 12,052,148 11,740,502
  Penetration 71.0% 69.1%
St.Petersburg 3,762,237 3,656,389
  Penetration 59.3% 57.7%
Russian Cellular
Market Breakdown, Feb 2004
Russian Net Additions,
February 2004

Top 10 Mobile Operators

# Company February 29, 2004 January 31, 2004
1 MTS 18,945,000 18,070,000
Moscow
5,200,000 5,061,000
Ukraine (UMC)
3,652,415 3,490,000
Belarus
549,348 505,400
2 Vimpelcom 12,549,000 11,935,000
Moscow
5,909,000 5,757,000
3 MegaFon 7,163,222 6,737,771
Moscow
888,148 867,646
Tajikistan
15,294 15,000
4 Uralsvyazinform 1,201,800 1,251,100
5 SMARTS Group 1,195,000 1,172,000
6 Sibirtelecom 574,700 536,000
7 N.Novgorod Cellular 415,383 396,870
8 Ekaterinburg Cellular Communications 245,944 237,475
9 Dal Telecom International 236,122 220,093
10 New Telephone Company 167,728 159,492

Moscow and St.Petersburg

Moscow License Area

In February Vimpelcom won back its leading position in monthly net additions from MTS.

Moscow Market Breakdown
February 29, 2004
Net Additions in Moscow,
February 2004

St.Petersburg and Leningrad Region

MegaFon dominated the market in February with 43% of all new users attracted to the network. The company maintains its market share of 50% while MTS and Vimpelcom have 33% and 10% respectively. Penetration of mobile services in St.Pete is about to reach 60%.

St. Petersburg Market Breakdown
February 29, 2004
Net Additions in St.Petersburg
February 2004
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05
Feb

Russian Cellular Market Added 1.73 mln in January 2004

1.73 mln new subscribers joined Russian mobile networks in January 2004 which is 0.69 mln more than in Jan-03. Moscow market grew by 248 thousand users, 39 thousand less than a year ago.

MTS remains the market leader with more than 18 mln subscribers werved by the company's networks across Russia, Ukraine and Belarus. Vimpelcom is about to step over 12 mln threshold in February. The company added 540 thousand of new subscribers in January.

Russian Mobile Subscribers

Mobile Subscribers Jan 31, 2004 Dec 31, 2003
Russia 37,960,000 36,230,000
  Penetration 26.1% 25.0%
Moscow 11,740,502 11,487,308
  Penetration 69.1% 67.6%
St.Petersburg 3,656,389 3,526,336
  Penetration 57.7% 55.6%
Russian Cellular Market Breakdown, Jan 2004
Russian Net Additions, January 2004

MTS have 14.07 mln users in Russia and almost 4 mln of subscribers abroad. Vimpelcom and MegaFon follow MTS with 11.9 mln and 6.7 mln users respectively. Uralsvyazinform moved up in the list of top Russian operators outperforming SMARTS association.

Top 10 Mobile Operators

# Company January 31, 2004 December 31, 2003
1 MTS 18,070,000 17,291,000
Moscow
5,061,000 4,940,000
Ukraine (UMC)
3,490,000 3,349,000
Belarus
505,400 465,000
2 Vimpelcom 11,935,000 11,395,000
Moscow
5,757,000 5,651,000
3 MegaFon 6,737,771 6,353,335
Moscow
867,646 850,308
Tajikistan
15,000 13,000
4 Uralsvyazinform 1,201,800 1,143,100
5 SMARTS Group 1,172,000 1,150,000
6 Sibirtelecom 536,000 507,000
7 N.Novgorod Cellular 396,870 368,321
8 Ekaterinburg Cellular Communications 237,475 230,112
9 Dal Telecom International 220,093 205,199
10 New Telephone Company 159,492 150,920

Moscow and St.Petersburg

Moscow License Area

In January MTS attracted more users than Vimpelcom for the first time in 7 months. Nevertheless, Vimpelcom maintains the lead in Moscow with market share of 49%.

Moscow Market Breakdown January 31, 2004
Net Additions in Moscow, January 2004

St.Petersburg and Leningrad Region

In St.Petersburg MegaFon leads both in net additions and market share. On its home market the company enlisted 44% of all new subs, which is more than combined additions of its main rivals, MTS and Vimpelcom. Please note that additions in Delta Telecom IMT-MC-450 network were not meaningful in January.
St. Petersburg Market Breakdown January 31, 2004
Net Additions in St.Petersburg January 2004