Telecommunications industry in Russia - statistics & facts
Russia's telecommunications market is currently challenged by Western export bans on high-tech equipment to Russia in response to the invasion of Ukraine that began in February 2022. Major telecommunications equipment providers, such as Ericsson and Nokia, left the market. To support the domestic industry, the government offers subsidies and cheaper loans to manufacturers. Overall, the country has a large consumer base, with over 127 million internet users, more than in any other European country.
Following Veon's sale of Vimpelcom, all four major telecommunications operators in Russia are domestic companies. Besides providing telecommunications services, they often expand their portfolio to offer a digital ecosystem of services.
Barriers to 5G adoption in Russia
5G in Russia is only deployed by a few operators and in a limited or test mode. Government requirements have delayed the adoption process, as the 3.4 to 3.8 GHz frequency band, used for 5G in some other countries, had been previously reserved for government and military use. Therefore, the spectrum of 4.4 to 4.9 GHz is planned to be used for 5G connections. Furthermore, the exodus of Western equipment providers is slowing down 5G adoption, as the government is required to use only domestically built equipment for 5G networks. Pilot testing of Russian-built 5G is planned for 2025 in cities with over one million inhabitants.The Big Four mobile operators
Russia's four major mobile operators are often referred to as the Big Four. They are MTS (or Mobile TeleSystems), MegaFon, Beeline, and Tele2 (owned by Rostelecom). Beeline is a brand of VimpelCom, a former Russian subsidiary of the Dutch operator Veon that was sold to local managers in 2023. MTS is the highest-earning mobile operator in Russia. One quarter of the country's smartphone users reported having MTS as their mobile carrier in 2022, while just over 20 percent were Tele2 customers and 16 percent used MegaFon. Furthermore, MegaFon had the highest median download speed among the Big Four.The transformation of Rostelecom
Rostelecom, established in 1993 and co-owned by the government, has traditionally been labeled as Russia's market leader for fixed-line voice services. However, as the country sees a decline in landline phone usage, the company has steadily expanded to other telecommunications segments. In 2020, Rostelecom fully acquired the Russian subsidiary of the Swedish mobile operator Tele2, making mobile services its largest source of revenue. In 2023, Rostelecom earned more than twice as much from fixed broadband internet services than from fixed-line telephony. Furthermore, the company now offers pay TV, information security, and digital services, including Wink, an over-the-top (OTT) video platform.Following Veon's sale of Vimpelcom, all four major telecommunications operators in Russia are domestic companies. Besides providing telecommunications services, they often expand their portfolio to offer a digital ecosystem of services.
