Russian 4Gap: distribution of 4G networks in Russia and in the world

Hello. Let me introduce myself: I am an ordinary author of the blog of the company Huawei, hosted on Habré, and I am sad. What was the reason? Elementary: I got acquainted with the results of a study of the Russian and global mobile markets. Due to this indignation post!

Diagnosis

To begin with, I propose to look at the numbers, and then proceed to the arguments. So, according to the latest GSMA data, in the third quarter of 2016 in Russia, the number of connections via mobile networks reached 250.1 million (excluding mobile M2M), among them the number of 2G standard connections was 134.4 million, 3G - 87.9 million, and 4G - 27.8 million

Thus, the mobile penetration rate (number of connections / population) exceeded 170% and became one of the highest in the world. Statistics looks rosy and positive, if you do not go into details, in which the devil is usually hidden. Let us dwell in more detail on what this high level of mobile penetration tells us.
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He says exactly two things:

1. The Russian market is oversaturated with this service;
2. No further significant increase in subscribers can be expected.

From these two points it follows a quite logical conclusion: the revenues of telecom operators from traditional voice services cease to grow and even begin to fall, and mobile broadband services are seen as the main source of income for operators. And global trends in the development of the mobile communications market unintuitively hint at the truth of this conclusion.

It turns out that the development of mobile broadband services (namely the development of 3G networks and especially 4G networks) becomes a priority for operators. And here we come to the most interesting! According to the same GSMA, the penetration of 4G networks in Russia (the number of connections over the 4G network / total number of mobile connections) is only 11.11%. And this is nothing but the slow development of mobile broadband services in Russia.

For comparison, let's take a look at the statistics for other countries:

Awareness

The commercial launch of 4G networks in Russia took place in December 2011 - 5 years ago. In 2011, 4G networks were launched in America, Japan, South Korea and other countries, where their penetration rate has already reached 60% -80%. In the same China, where the penetration rate of 4G networks is about 50%, the commercial launch of 4G networks was made only three years ago, at the end of 2013.

In Russia, 3G networks are widely distributed and already overloaded, and 4G networks are not sufficiently loaded. This indicates that the demand of Russian subscribers for data transmission services is high, while the use of 4G networks is inefficient.

The logical question is: how does China achieve these indicators? The answer is quite simple: the number of 4G subscribers in China is growing very fast, and the effective step for this growth was the promotion of 4G-enabled smartphones by operators.

From the very beginning of the commercial use of 4G networks, telecom operators in China, in their own stores, collaborating with electronics stores and through other sales channels, actively popularized 4G smartphones. According to the Chinese Academy of Information and Communication Technologies (CAICT), the structure of the mobile electronics market has been changing rapidly since 2014: the share of 4G smartphones is growing rapidly, and the share of 3G smartphones is dropping sharply. The share of 4G-smartphones, which was about 10% at the beginning of 2014, reached 70% by the end of 2014, and today it is 90%. And the rapid spread of 4G smartphones naturally changed the needs of subscribers.



If, for comparison, look at the statistics of sales of mobile devices in Russia in the first seven months of 2016, then from the GFK study we will see that the shares of 2G, 3G, 4G smartphones are approximately equal (1/3), which naturally does not contribute to the growth in the number of subscribers 4G networks.


The question that has become traditional for us is brewing: what to do?

Recipe

Actually, the recipe is also nothing new: in order to achieve rapid growth of 4G subscribers, Russian mobile operators should contribute to changing the structure of the mobile device market.

What are the tools for this?

First, operators need to increase the number of 4G advertising, with which they can reach subscribers, what is the superiority of 4G networks over 3G networks. In addition, the cost of services provided over 3G and 4G networks is the same, however, 4G networks significantly increase user experience and also increase subscriber data traffic.

Secondly, if the buyer does not know what the difference between these standards is, he will, of course, choose the cheaper option in the store, despite the fact that the price difference is insignificant, and not thinking whether he buys a 4G smartphone. All flagship models of smartphones support 4G, and if the buyer chooses a 3G smartphone, this means that he needs mobile data services, but his funds are limited. In their own stores and online stores, operators can offer such buyers more affordable 4G-smartphone models as an alternative to 3G smartphones. Prices for 3G and 4G smartphones are almost the same, and if the operator can stimulate the buyer (for example, offer him a more profitable tariff plan), the buyer will choose a smartphone with 4G support.

Thirdly, operators can also develop close cooperation with independent companies selling mobile electronics or mobile device manufacturers: jointly promote 4G devices (for example, analyze the most popular models together with manufacturers and place them in their own stores or retail stores).

Fourthly, simultaneously with the promotion of 4G smartphones, operators must distribute 4G-enabled SIM cards, adjust tariff plans and take other actions aimed at providing unhindered access for subscribers to 4G networks.

Autopsy show?

I think for many it is obvious that the spread of 4G smartphones will certainly increase the penetration of 4G networks, and this will contribute to the development of mobile broadband services.

In the meantime, smartphone makers (including Huawei) are throwing all their strength into producing 4G smartphones, I went to my mobile operator to get a 4G SIM card.

By the way, are there active users of 4G networks? How do you?