Regional Mobile Growth In Full Swing

Russian mobile market grew by record 1.8 mln users in September 2003 fueled mainly by strong growth in regions. Moscow and St.Petersburg together added about 600 thousand of new subscribers while regional networks attracted the remainder bringing penetration of mobile services to 20.9%.

If the trend persists, there will be over 35 mln of cellular users in Russia by year-end 2003.

Top 10 Cellular Operators

Company September 30, 2003 August 31, 2003
Total Moscow Total Moscow
MTS* 14,270,000 4,490,000 13,280,000 4,390,000
Vimpelcom 9,250,000 5,025,000 8,530,000 4,835,000
MegaFon** 5,342,625 755,910 4,942,745 593,643
SMARTS Group 970,000   915,000  
Uralsvyazinform 947,600   869,800  
Siberia Telecom 405,000   352,744  
N.Novgorod Cellular 295,738   279,087  
Ekaterinburg Cellular Communications 165,234   161,490  
Dal Telecom International 150,711   134,453  
New Telephone Company 116,7881   107,387  

* including UMC of Ukraine (2.55 mln), MTS Belarus subscribers (310,000) and recently acquired Tomsk Cellular Communications (195,000)
** including 9,000 in TT-Mobile (Tajikistan)

Russian Cellular Market Breakdown

Penetration in Moscow and St.Petersburg is significantly higher compared to the rest of the country so it comes as no surprise that the cellular growth finally spilled over to regions.

Russian Mobile Subscribers

Mobile Subscribers Sep. 30, 2003 Aug. 31, 2003
Russia 30,280,000 28,480,000
  Penetration 20.9% 19.6%
Moscow 10,326,000 9,870,000
  Penetration 60.8% 58.1%
St.Petersburg 3,123,000 2,971,000
  Penetration 49.2% 47.2%

Vimpelcom has won the September race for new users in St.Pete for the first time since launching its network in the region. The company earned 34% of net additions followed by MTS (29%) and MegaFon (25%).

Moscow Market

Vimpelcom's Moscow client base grew over 5 mln with 190 thsd of new users added in September. The company leads in Moscow followed by MTS (4.49 mln) and MegaFon (0.756 mln).

MegaFon managed to attract a significant portion of net additions for the second month in a row. The company outperformed MTS thanks to its popular O'Lite tariff plan. MTS explains the slowdown in net additions by a high churn rate on its contract tariff plans resulted from swithching of its contract users to the company's pre-paid tariffs started two month ago.

Moscow Net Additions, August 2003