Telecoms market in CIS countries to remain mobile telephony dependent in 2012

The value of the telecommunications services market in the CIS countries and Georgia amounted to approx. €11bn in 2010, which means a growth of 10% year on year. PMR estimates that the market declined to approx. €10.5bn in 2011, shrinking by some 4.5% y-o-y. By far the largest segment of the telecommunications services market in the CIS region remains mobile telephony. The ISP segment is strongly underinvested and underdeveloped. The fixed-line telephony market has recently been somewhat stagnant. The mobile telephony domination is the most visible in the countries of Middle Asia, which have relatively highest prices for internet access services and ILD/DLD calls, while the prices of mobile telephony are comparable to other CIS markets. The majority of people in these countries cannot afford the internet and have no access to fixed phones, therefore mobile telecommunications have more than a 70% share in the total value of those markets.
The economic development of the CIS countries differs significantly, which is explained by different factors including geography, availability of natural resources, cultural differences of the population and political systems. The most developed CIS countries are Ukraine and Belarus, which have diversified economies with a significant share of processing industries. These countries also benefit from good geographic location being close to the huge market of the European Union as well as to the main Russian economic centres of Moscow and St. Petersburg. Belarusian economic growth is driven by the export of machinery, heavy equipment, household goods and agricultural products to Russia. The Ukrainian economy is based on metal production and the chemical industry. Both countries have significant earnings from the transit of Russian oil and gas to the EU states.

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