Mobile economy of Russia

2021

The share of mobile traffic in Runet reached 81%

The share of mobile traffic in Runet continues to grow. According to SlickJump, mobile devices in August 2021 account for about 81% of the total. Thus, stationary computers and laptops account for 19% of Internet traffic, which is the lowest rate since 2018.

Experts note that the pandemic has affected the overall picture of traffic separation. Starting in September 2020, the share of mobile traffic began to unexpectedly decrease, contrary to analysts' forecasts about its further growth. True, the forecast did not take into account the trend of switching to a remote work format and, as a result, an increase in the number of stationary workplaces. For example, if in an office environment workers could divide workstations among themselves, then work from home required the placement of individual stationary PCs or laptops.

Because of this, in January and May 2021, mobile traffic decreased to 77 and 75%, respectively, while the increase in the share of stationary traffic in May 2021 can be considered the largest since the beginning of 2020.

However, as of August 1, 2021, the share of mobile traffic increased again and reached 81%.

2020

Russians increased spending in mobile applications by 25%, to $1.33 billion

In 2020, Russians increased spending in mobile applications by 25% compared to 2019 - to $1.33 billion. Such data are provided by the Association of Electronic Communications (RAEC).

According to the study, the number of active users of social networks in Russia in 2020 increased by 30% and reached 64 million, and the number of messages in these services decreased by 8% - to 1.2 billion. Analysts noted that he was the leader in the number of TikTok installations, in the volume of payments - Boom, and in the number of active users per month - WhatsApp.

In 2020, Russians increased spending in mobile applications by 25%, to $1.33 billion

According to experts, social media trends in 2020 were:

• a noticeable increase in the number of authors of Instagram, Youtube and Tiktok;
• Instagram is in first place in the number of authors;
• VKontakte leads in content volume;

Analysts report that the share of mobile advertising in Russia in 2020 amounted to about 30% in the total Internet advertising market, and this indicator will continue to grow due to several factors:

• increasing mobile Internet penetration (including mobile-only audience);
• increasing the number of smartphones used;
• increasing the share of mobile content consumption;
• Development of ecosystems and super-applications.

Researchers note that in Russia, more and more companies in various business sectors - including classifieds, e-commerce projects, taxi, food and product delivery services - are developing mobile applications or completely switching to them, creating ecosystem solutions and superapps (applications with ecosystems inside) based on them.

The Russian market remains attractive to international customers due to both the active audience and the low rate for the attracted installation (CPI). In this regard, market players will continue to invest budgets in the development of mobile applications, which means that the market volume will grow, experts say.^[1]

SlickJump: mobile traffic in Runet reached 80%

Mobile traffic in Runet reached 80%, thereby actually displacing classic stationary computers and laptops. This was announced on September 28, 2020 by SlickJump. At the same time, a serious increase in traffic from mobile devices has been recorded since the beginning of 2020, when the coronavirus pandemic began in the world. More details here.

2017: RAEC data

In September 2017, RAEC, together with the international research agency OC&C Consulting, with the support of Google Russia and a number of Runet players, implemented the Mobile Economy of Russia 2017 research project. The study is positioned as part of an international study and part of the annual industry study "Digital Economy/Runet Economics 2017"^[2]

Main provisions

The contribution of the mobile economy (or rather the mobile Internet economy) to the work of enterprises and the life of consumers is huge, and this report presents a comprehensive overview of the economy, combined with mobile technologies, to compile an exhaustive picture and assess the situation. A methodology based on a balanced data-centric approach brings together all important elements of the entire mobile Internet infrastructure, rather than parts of it (for example, only enterprises or high-level factors) to assess their benefits and potential for any market.

Together, the Russian mobile technology sector could enter the TOP-80 countries of the world in terms of GDP, ahead of the entire total economy of countries such as Belarus, Lithuania and Azerbaijan.

The mobile economy is already the 11th largest economic activity in Russia, competing in this indicator with the field of agriculture.

'With the increasing number of smartphone or tablet users and the country's cellular coverage area, the impact of mobile technology on GDP will naturally increase. In 2016, the direct contribution of the mobile economy to GDP amounted to 1.72% of the total GDP of Russia. This figure includes activities based on the mobile phone, such as the production and sale of devices and equipment, the cost of using mobile phones, infrastructure investments, mobile applications and their development, mobile commerce and mobile advertising. Future growth is expected to shift the balance from the traditional use of mobile devices and infrastructure to more advanced areas. We expect an increase in revenue from content family elements in this sector, especially from mobile commerce, content and advertising, as well as application developers. This reflects a change in the sphere of influence of a mobile phone from a device used exclusively for communication purposes to something larger, "comments Kazaryan Karen, chief analyst at RAEK

Each organization, which is an active participant in the mobile economy, provides the sphere of activity to countless suppliers and service companies. It is not so important whether we are talking about suppliers of components for the production of devices, cleaning companies or the functions of personnel management of a third-party organization for application developers, the positive impact of the mobile economy extends far beyond the scope of those firms that were primarily engaged in mobile technologies. This indirect impact amounted to 1.53% of GDP in 2016, which is equivalent to 1,303 billion rubles.

• In total, the direct and indirect contribution of the mobile economy accounts for 3.80% of the total GDP of Russia.
• With the help of the mobile economy, approximately 1.2 million jobs were created in 2016, which is 1.6% of total employment in Russia.

The population of Russia is young and dynamic, 45% of which are people under 35 years old. The penetration rate of mobile subscribers is 178%, which creates many opportunities for a market covering 146 million people. Smartphone owners in Russia are one of the most interested consumers who actively use the services of application stores and social networks.

Moreover, the Russian market also meets three main criteria for further expansion of mobile Internet use:

• Cost-effective connection/use of mobile network, including data transmission.
• The supply of smartphones at more affordable prices and the interest of customers in them is growing, thus increasing the degree of penetration of smartphones into the market.
• Although further expansion of mobile cellular coverage is needed, there is a high speed of broadband Internet access through the mobile network.

Conditions for the introduction of mobile Internet in Russia

In Russia, there are many favorable conditions for the development of a mobile economy with a large sphere of influence, which will help the country increase its growth rate and in the future approach the level of its world partners.

These conditions may be formulated as follows:

• Young, interested population connected to the network: The population is a favorable condition for the development of the mobile economy, and Russian users are one of the most interested smartphone owners in the world.
• Wide connectivity options at an affordable price: In Russia, favorable prices have been set for the development of mobile communications in terms of prices for package and individual voice and SMS services. The costs associated with data transmission are also low in nominal terms and in terms of accessibility, which creates a favorable environment for the growth of the mobile economy. In addition, fixed prices for high-speed Internet are also among the most affordable among countries with benchmarks.
• Availability of affordable equipment: Low and constantly declining prices for smartphones indicate further potential growth in the mobile services sector.
• The current transition to mobile technologies: The volume of mobile traffic is growing rapidly and replacing the home one.
• Conditions for the activity of entrepreneurs in the field of technology: In Russia, there are stable conditions for the activity of entrepreneurs in the field of technology, with the help of which the development and growth of the number of mobile technologies is supported.

Mobile infrastructure

The mobile Internet economy, despite its importance, has almost never been considered on its own.

The main benefits that the national economy acquires through mobile technologies are the speed of the creation of companies. From 2003 to 2016, the amount of time that the business spent on registering was halved in the world. We at Google set ourselves the task of reducing the amount of time to register from a smartphone to 5 minutes. [Marina Zhunich]], the director of interaction with bodies state vlastigoogle Russia

Levels of mobile economy infrastructure:

• Level 1 - Direct contribution to GDP, consists of companies that come to mind first when we think about the mobile economy. These companies produce devices, provide connectivity and content for consumers and businesses.
• Level 2 - Forms part of the indirect contribution to the economy and includes service providers and service providers that serve Level 1 companies. Suppliers provide raw materials that are purchased and accounted for as the cost of sales of Level 1 companies. Some sectors of this group exist exclusively to serve Level 1 companies, so suppliers are in a symbiosis relationship with them; they are highly dependent on the presence and growth of Level 1 companies in the market. SIM card suppliers, spare parts manufacturers, etc., are just some examples of such supplier companies.
• Level 3 - Level 3 companies form the final part of the indirect contribution of the economy based on mobile Internet to the economy as a whole (GDP). It includes performance gains and additional revenue from small and medium-sized enterprises and large enterprises through the existence of mobile devices.
• Level 4 - Level 4 is dedicated to "additional benefit to the consumer." It is defined as all the benefits that consumers have gained in connection with the use of mobile devices and their ability to connect to the network, with the exception of the total cost of maintaining a mobile phone connected to the network.

RAEC highlights the following features of the Russian mobile economy:

• Mobile traffic in the Russian Federation is almost 10 times cheaper than in the USA, almost 3 times cheaper than in Germany, almost 2 times cheaper than in South Africa
• Russia - 5 countries by number of downloaded applications
• Availability of quality personnel in the domestic market

Impact on GDP

This level 4 infrastructure generates an economy based on mobile Internet, which is a significant contribution to the overall economy of Russia. In the future, its importance will increase compared to other economic activities, while its impact on Russia's GDP will increase.

'We expect the mobile economy to grow in GDP from 3.8% in 2016 to 4.7% in 2021, including the impact of all the above levels. Perhaps surprisingly, most of the growth will come from indirect contributions, that is, from enterprises that have been founded, improved, or developed through the presence of mobile technology. " commented by Director of RAEC Sergey Plugotarenko.

• Between 2016 and 2021, GDP growth of more than 7.5% will occur only thanks to the mobile Internet-based economy.
• Also, according to RAEK analysts, the mobile Internet economy is expected to increase to 10.7% in 2016-2021, reaching 5,379 billion rubles, while GDP growth in Russia, according to IMF analysis, will be 6.0%.

Future Prospects - Unrestricted Growth Rate

Faster development of the mobile economy should be a priority. As its overall contribution to GDP increases, more workers will enter the industry. This will be a big plus for the Russian labor market.

There are a number of aspects that the state could look at to maximize further growth. So, according to RAEC and OC&C Consulting, several potential drivers of the development of Russia's mobile economy should be highlighted today:

• Availability of talented personnel
• A thriving technologically enabled environment
• Attracting qualified personnel and foreign companies
• Localization and leading local enterprises
• International influence
• Change existing situation
• Government support

See also

• Internet economy
• Joint Consumption Economy (ESP, Sharing Economy)
• Russian economy
• Mobile applications (Russian market)
• Mobile broadband Internet (Russian market)
• Mobile advertising (Russian market)
• Mobile Content
• Mobile Payment Services
• Cell phones (Russian market)
• Cellular (Russian market)

Notes