The Russian telecommunications market is expected to stay stable for the next couple of years, with major telecoms turning to non-core assets and possible expansion to the other market segments such as Software-as-a-Service (SaaS), IT and digital content, says consultancy PMR Publications.
What is more, the organisations with more diversified portfolio including fixed and mobile data and voice services will achieve the best operational synergies while the key telecommunications services market in Russia is reaching its maturity. Although the general outlook is pretty stable, there is less space for organic growth which, in turn, will force the big players to look at the expansion through acquisitions.
The Russian market is dominated by the three large operators MTS, VimpelCom and MegaFon which together with Rostelcom, according to PMR, control most of the fixed-line market revenues in the country. Additionally, 2014 saw the emergence of the joint venture between Rostelecom and Tele2, where under the terms of agreement Rostelecom transferred its mobile networks and operational licenses and holds a 45% stake in the business.
At the turn of 2014 and 2015 the Russian market also witnessed the stable activity in M&A, despite a demanding macroeconomic situation, with two considerable deals when a Russian mobile operator Smarts began to sell its regional subsidiaries and the second one being the acquisition of Gars Telecom, a provider of telecommunications services for the corporate users in Moscow, by MegaFon.
The Russian telecoms are looking for new opportunities outside of its core market and this is expected to be a growing trend in the next years with the first signs being a purchase of a 10.8% stake in the operator of the online stores Ozon Holding by MTS and the acquisition of the system integrator NVision Group by MTS, says PMR.
