Demand for LTE devices is increasing in the Urals

A year after the launch of fourth-generation LTE (4G) mobile networks in the Urals, a noticeable increase in sales of devices that support this communication standard began. According to operators' estimates, in the first half of 2015 the share of LTE gadgets in the total volume exceeded 20%. In addition, the market participants themselves had an influence, in order to stimulate the consumption of data traffic, maintaining low prices for devices. Analysts predict that sales will grow more rapidly in the second half of the year.

The majority of participants in the Ural market told Kommersant about the growth in sales of LTE devices in the first half of the year. “Every fifth smartphone sold in the first half of the year supported 4G networks, this is one of the fastest growing segments today,” noted Daniil Khrustalev, director of the MTS retail network in the Urals. Megafon confirmed the trend, noting that growth is facilitated by the introduction of budget models to the market and the provision of additional discounts. “Smartphone sales increased by 17%. At the same time, clients began to give greater preference to budget devices (cheaper than 3.5 thousand rubles), the share of which in the structure of sales in the retail network in the Urals amounted to 46%. Another 35% were gadgets costing 5-10 thousand rubles,” said the Megafon press service.

Megafon was the first to launch an LTE network in the Urals in the fall of 2013. In the spring of 2014, MTS joined it, in the fall - VimpelCom (TM Beeline) and Motiv, Tele2 from September 1, 2015 - only in Khanty-Mansi Autonomous Okrug. A year ago, the share of sales of LTE devices in the share of smartphones in the Urals did not exceed 15%, given the rush demand for electronics in December 2014 due to currency fluctuations.

For consumers, not only the average cost of LTE devices is reduced, but also the cost of communication services. After the operators Tele2 (which declares cheap prices for communications, but has virtually no LTE infrastructure) and Yota (which considers the absence of domestic roaming and a limit on Internet traffic as its advantage) to appear on the Ural Federal District market in the summer, competition in the region, including price, has intensified. For example, the Ural operator Motiv (has LTE infrastructure, but does not have 3G licenses) has launched a tariff line in which only Internet traffic packages are paid, and all calls and SMS in the home region are not charged.

Leading analyst at Mobile Research Group Eldar Murtazin believes that the growth in sales of LTE devices is only due to the fact that the technology has become more accessible and devices have become cheaper. In his opinion, for most consumers, support for fourth generation networks does not matter, and even when using mobile Internet on 4G networks, they do not increase data traffic consumption. According to Denis Kuskov, CEO of the information and analytical agency Telecom Daily, in addition to price, demand is also influenced by the fact that operators have provided high-quality LTE coverage in large cities. On the contrary, he believes that increasing the penetration of 4G devices is beneficial to operators, as it can affect their revenues. “Since LTE speeds are noticeably higher, it is easier for the user to spend a large amount of traffic, which encourages the purchase of larger data packages,” he explained. Analysts agree that in the second half of the year we can expect even more rapid growth in sales of LTE gadgets.

Alena Tronina

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