Public Wi-Fi networks in Russia

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Public WiFi network authorization system in Russia

Why Russians refuse free Wi-Fi

On March 13, 2018, Ernst & Young (EY) published a survey showing that Russians began to give up free Wi-Fi networks. Instead, users prefer to access the Internet through the mobile networks of their operators.

The study involved more than 100 thousand people living in Moscow and other cities with a population of 100 thousand or more.

According to EY, cited by Kommersant, 65% of respondents stopped using public Wi-Fi due to the need to undergo authorization each time, excessive advertising and fear for personal data.

Due to the abundance of advertising and the complex authorization process, mobile device owners began to refuse to use public Wi-Fi

Almost 70% of users would like to have a guarantee of complete confidentiality of their data. 26.6% of them are willing to pay so that their data is not sold by the operator, and the smartphone and communication channels are protected. 

For two years, the number of Wi-Fi access points in Moscow alone has increased more than tenfold, but since July 2017, analysts have recorded a decrease in the number of sessions (web authorizations) in public Wi-Fi (from 360 thousand to 183 thousand in January 2018), and since September - and incoming traffic. The study says that the number of users of Moscow Wi-Fi is growing largely due to visitors who can save on roaming with public wireless networks. 

Department of Information Technology (DIT) Moscow They agree that public Wi-Fi networks began to be used less and less for Internet access, and explained this by the fact that the number of public Wi-Fi sessions, especially its use in parks and on the streets, is strongly tied to the seasonal factor.

So, in cold weather, the number of people walking on the street decreases, therefore, the traffic indicators and the number of public Wi-Fi sessions, - explained in DIT.

According to experts, one of the reasons for the rejection of connections to free Wi-Fi is the growing popularity of package tariffs, in which cellular operators include large volumes of mobile traffic

Ministry of Communications: Identification of Wi-Fi users is not the responsibility of restaurateurs

Identifying users of public Wi-Fi networks is the responsibility of telecom operators, not restaurants and hotels. This was reported in December 2017 by Kommersant with reference to a letter from the Ministry of Communications of the Russian Federation.

According to the current legislation, users of free Wi-Fi are required to pass identification. Companies that distribute Wi-Fi without authorization must pay a fine of 50-300 thousand rubles. Since the beginning of this year, Roskomnadzor has checked 17.4 thousand Wi-Fi access points in public places. According to the results of inspections, 1.5 thousand violations of the law on mandatory user identification were revealed.

According to restaurateurs, now there is no clear distinction between the duties of telecom operators and the restaurant and hotel business. Because of this, regulatory authorities can interpret the laws in two ways, creating conditions for additional administrative pressure on companies. In this regard, at the beginning of this month, the Federation of Restaurateurs and Hoteliers of Russia appealed to Igor Fomin, a member of the Federation Council Committee on Social Policy, with a request to obtain an explanation from the Ministry of Communications on the identification of users of free Wi-Fi.

The project of a unified authorization system in the Wi-Fi network caused criticism of the FAS

The Federal Antimonopoly Service (FAS) sent an appeal to the Ministry of Telecom and Mass Communications in October 2017 criticizing the bill on the creation of a unified system for identifying users of public Wi-Fi networks. According to Vedomosti, a letter from the FAS deputy head Anatoly Golomolzin says that there is no need to create such a system, since wireless public networks cover small areas, each of which has its own characteristics.

In addition, the project poses a threat to competition - the document assumes the presence of only one project executor, and also proposes to introduce a single Internet provider for departments, schools and hospitals

Violation statistics

The number of detected violations by owners of Wi-Fi access points in Russia is decreasing. For nine months of 2017, Roskomnadzor, together with specialists from the radio frequency service, checked 17.4 thousand such points. Of these, more than 1.5 thousand worked in violation of the requirements of the law on mandatory user identification - this is 3.5 times less than in the same period last year.

Most of the violations were identified in the Central, Southern, Volga and North Caucasian federal districts. As a result of the work carried out since the beginning of the year, 216 protocols on administrative violations against telecom operators have been drawn up.

In other cases, public access points were organized by subscribers of telecom operators with whom subscriber contracts were concluded. Territorial bodies of Roskomnadzor in such cases send information to law enforcement agencies to take measures in accordance with the law.

FEED Plans

In July 2018, under the leadership Ministry of Digital Development, Communications and Mass Media , technical design and development of a unified user authorization system in public networks should begin. Wi-Fi This is stated in the action plan for 2017-20 in the direction of the "Information Infrastructure" program "" Digital economy(there is, RBC its authenticity was confirmed by two members of the profile working group)^[1]

As explained by two interlocutors of RBC, close to federal telecom operators, we are talking about a system that will allow you to establish the identity of the user (identify) and predostavlya​​t him access to the network (authorize). At the same time, the authorities will begin to develop, discuss and adopt amendments to the legislation that will provide a legal basis for the work of this system. It is planned to complete the development of the system and amend the legislation in June 2019.

In the action plan for 2017-20, there are no specific details about how the Unified System for Identifying Users in Wi-Fi Networks will work. It is only known that the system will be integrated state with the Unified Identification and Authorization System () UIAS (^[2] is used for authorization on the public services portal (and, possibly, with subscriber bases of cellular operators). According to the Ministry of Telecom and Mass Communications, as of June 2017 UIAS , data on 50 million registered Russian citizens are stored in.

The interlocutor of RBC in the communication market says that the project of a unified user authorization system in Wi-Fi networks more reflects the interests of Rostelecom, which heads the Competence Center for Information Infrastructure. "The company probably has ambitions to become a single operator of the user authorization system on Wi-Fi networks. This is a profitable commercial story, since all authorization systems allow you to sell ads that pop up with the user when connected to a Wi-Fi network. In addition, the company, in this case, will be able to become a single database storage operator for all users connecting to Wi-Fi networks, "he says.

Down with the anonimnost​​

The need to identify users connecting to public Wi-Fi networks has arisen since August 2014, when two relevant government regulations were signed. This does not apply to private users who organize Wi-Fi networks at home using their router. However, all legal entities and individual entrepreneurs are required to identify users who connect to public access points in. Internet For these purposes, there are now a large number of commercial services, the services of which can be used by owners of public networks.

Market Valuation

2022: The Russian market for public Wi-Fi services showed growth. Leaders

The volume of Russian Internet access services through public Wi-Fi networks in 2022 reached 5.1 billion rubles, which is 3% less than a year earlier. At the same time, the number of access points increased by 2.9%, to 191.1 thousand units. This is evidenced by the data of TMT Consulting analysts, published at the end of May 2023.

Researchers attributed the fall in the market in money primarily to a decrease in revenues from advertising monetization of Wi-Fi networks as a result of international sanctions: adjusting the advertising budgets of the largest advertisers and freezing marketing activities amid the suspension/revision of their activities on the Russian market. The dynamics was also influenced by a decrease in the number of equipment sales, however, operators note that service revenue continues to increase.

Although positive dynamics in natural indicators remained on the market, the dynamics decreased - in 2021, the number of points of access to public WiFi networks in the Russian Federation increased by 3.7%. The slowdown is due to the completion of a number of large contracts for the service. The key customers of the services, as before, are the transport sector (urban ground transport, subways of Moscow and St. Petersburg), city organizations interested in the development of public digital services for users, healthcare institutions, cultural and social institutions, specialists explain.

Representatives of HoReCa, retail, shopping and business centers, medical centers, fitness centers, beauty salons remain the main consumers of services in the small and medium-sized businesses market. Among large businesses: large-format retail (including darkstores), banks, service companies, gas stations. Among the factors that positively affect the development of the market, experts distinguish:

• rising tariffs for mobile communications and the Internet, which makes public Wi-Fi access an attractive alternative for end users;
• distribution of payment for goods/services through/ QR code, SBP as well as the use of loyalty programs by customers. To ensure stable access to such applications, it is necessary to deploy Wi-Fi networks in the retail space (including with poor mobile coverage);
• The use of a service to create wireless networks in multi-storey offices, warehouses, co-working spaces, campus buildings (several buildings distributed throughout the territory belonging to the same enterprise/company);
• digitalization of urban infrastructure and public transport.

The largest players in the public Wi-Fi market in Russia in 2022 were named Rostelecom, Maxima Telecom, ER-Telecom and VimpelCom. The share of Maxima Telecom in monetary terms reached 30%. In 2022, the number of locations managed by the company grew by 12% (including partner networks). The growth is associated both with the development of partner projects and with the expansion of its own network of "Maxima Telecom" in new segments in transport and stationary facilities, with the development of urban digital services.

Rostelecom in 2022 remains the leader in the number of served points of public Wi-Fi access. According to TMT Consulting, their number was 58 thousand, an increase of about 2%. Revenue, according to TMT Consulting, also increased by 2%.

The number of public Wi-Fi points serviced by ER-Telecom at the end of 2022 was about 26.6 thousand (+ 3% by 2021). Revenue for the Wi-Fi product line for 2022 compared to 2021 increased by 17%. The outstripping revenue growth is due to the connection of additional Wi-Fi-based services (such as content filtering, the organization of a closed network for business use, additional authorization options), analysts point out.

Public Wi-Fi access in Russia: results of 2022

2021: The Russian market for public WiFi points added 3.7%

By the end of 2021, Russia had 185.7 thousand public Internet access points using Wi-Fi technology, which is 3.7% more than a year earlier. The revenue of telecom operators from such services during the same period increased by 2.8% and reached 5.3 billion rubles. Such data analysts of TMT Consulting were published at the end of March 2022.

The Russian market for public WiFi points added 3.7% over the year

Among the factors that influenced the growth of the market, the researchers highlighted:

• An increase in the number of companies considering a Wi-Fi network not only as an element of loyalty for their visitors, but also as a marketing tool for business development;
• Enhancement of product analytical tools, integration with external customer systems;
• Use the service to create wireless networks in multi-storey offices, warehouses, coworking spaces, campus buildings (several buildings distributed over the * territory belonging to the same enterprise/company);
• Digitalization of urban infrastructure and public transport;
• Increased penetration of the service in the social sphere.

Leaders of the Russian market for public WiFi points

The following companies are named the largest players in the public Wi-Fi market in Russia in 2021: Rostelecom, Maxima Telecom, ER-Telecom and VimpelCom. In 2021, Maxima Telecom accounted for 36% of revenues in the public WiFi market. In 2021, the number of points managed by the company increased by 11% (including partner networks). The growth is associated with large projects for the development of infrastructure for socially significant objects, passenger services in the rolling stock of public transport in Moscow, and the expansion of urban digital services. Rostelecom in 2021 remained the leader in the number of served points of public Wi-Fi access - 56.5 thousand. The number of points for 2021 at the company increased by 8%. ^[3]

2020: Revenue growth from public Wi-Fi by 2%, to 7 billion rubles - TMT Consulting

Operators' revenue from the provision of wireless Internet access services in public Wi-Fi networks in 2020 reached 7 billion rubles, which is 2% more than a year ago. Such data are provided by TMT Consulting.

According to experts, by the end of December 2020, there were 178 thousand public Wi-Fi access points in the Russian Federation, which is 7% more than a year earlier.

The study notes that restrictive measures led to a decrease in the volume of consumption of services, but in the whole year the market managed to maintain positive dynamics. At the same time, the pace slowed down: in 2019, revenue growth was 12%, and the number of access points increased by 23%). Revenue and dynamics of connections in the mass segment of service consumers - small and medium-sized businesses - suffered the most. In 2020, positive market dynamics remained primarily due to the large business segment.

The leader in the market for Internet access services in public Wi-Fi networks in terms of revenue was "Maxima Telecom," which accounted for about 48% of revenues. In 2020, the number of points managed by the company increased by almost 13% (including partner networks, from which the company receives revenue from identification, authorization and monetization services).

Rostelecom in 2020 became the leader in the number of served points of public Wi-Fi access - more than 52 thousand. The number of points for 2020 increased by 15.5%. The operator's revenue increased by 15%. The main growth in 2020 was provided by customers from the healthcare sector, as well as from the banking sector.

At ER-Telecom, the number of public Wi-Fi points served by the company at the end of 2020 was about 24 thousand (+ 4% more than in the previous year). Revenue increased 10% with additional Wi-Fi-based services^[4]

2019:166 thousand pub­lichnykh to­chek Wi-Fi - dos­tu­pa. Revenue ope­rato­rov svya­zi 7 billion rubles (+ 12 %)

Following the results of 2019 in Russia there are 166 thousand public points of Wi - Fi - access. This was so­ob­shcha­et in July ana­liti­ches­kaya kom­pa­niya TMT Kon­salting. to­chek growth in bes­pro­vod­noy lo­kal­noy se­ti for the year sos­ta­vil 23%. The revenue of telecom operators from services of Wi-fi in 2019 reached 7 billion rubles - it is 12% more,^[5] rubles.

According to TMT, in 2019, public Wi-Fi grew noticeably in the banking sector, the passenger transportation segment, as well as in the public sector. The main factors of the market growth were the growth of the number of business customers who consider the Wi-Fi network as a separate channel for promoting goods and services, increasing interest in digital advertising and data services, as well as the introduction of digital technologies in government agencies and the deployment of time points for mass events. Among the trends noted on the market in 2019, operators highlight the appearance of requests from large customers for the specialized functionality of the service necessary to solve specific business problems.

Analysts cited the following as the main growth factors for the market in question in 2019:

• Growth in the number of business customers considering a Wi-Fi network as a separate channel for promoting their goods and services;
• Increasing interest in Digital Signage tools and data services, in connection with the desire of business clients to transfer advertising activities from an offline environment to online;
• Continued adoption of digital technologies in government agencies;
• Deployment of temporary Wi-Fi networks for mass events.

The largest players on the market in terms of revenue last year were Maxima (Maxima Telecom) (43%, or about 3 billion rubles), ER-Telecom (16%), Rostelecom (12%), VimpelCom (Beeline brand, 6%). In terms of the number of access points, the first among the players is Rostelecom (27%), the second is Beeline (15%), the third is ER-Telecom (14%).

Maxim has 8% of points in the entire market. "Over the year, the number of points managed by the company has almost doubled (the company does not own all of them, but receives revenue from identification, authorization and monetization services), mainly due to the fact that at the beginning of 2019 Maxima Telecoms became the single operator of the city network, Moscow_WiFi_Free" TMT experts say. According to a representative of the operator's press service, last year Maxima Telecom increased the number of points under control to 32 thousand.

"Rostelecom" at the end of 2019 was the leader in the number of served points of public Wi-Fi access - there were 45.1 thousand of them. The number of operator points over the past year increased by 64%.

In 2019, the number of hot spots organized by ER-Telecom in Russia increased by 13%, exceeding the mark of 23 thousand points. The company's revenue increased by 21%.

The number of served points of public Wi-Fi access at Beeline at the end of the year amounted to 25.5 thousand. The operator's revenue for 2019 increased by 18%.

Operators noted a decrease in the volume of service consumption due to restrictive measures taken in April this year. First of all, the restrictions affected the segment of small and medium-sized businesses - service enterprises, HoReCa, hotel business, as well as public Wi-Fi networks in public places and transport. The TMT study said that the decrease in revenue from Wi-Fi access services during the restriction period was 20-30% compared to the period before the COVID-19 pandemic.^[6]

Chronicle

2023: Fraudsters in Russia start creating fake Wi-Fi hotspots to steal bank data

In mid-August 2023, Sberbank warned of a fraud scheme that allows attackers to obtain payment information when a person connects to a fake Wi-Fi point. The credit institution announced this in its Telegram channel.

By creating a fake hotspot or hacking public Wi-Fi, fraudsters can obtain and use your personal and payment data for their own purposes, Sberbank said in a statement.

To protect yourself, Sberbank recommends:

Sberbank warned of fraud through fake Wi-Fi points

• Verify that the Wi-Fi point is using WPA2/WPA3 encryption. Information about this can be found in the "Security Type" section of the Wi-Fi access point properties.
• When connecting to public Wi-Fi, do not use banking applications, do not pay on sites and do not download anything.
• Only go to sites with a secure connection: the address bar must contain a lock and the letters https.
• Install antivirus software.^[7]

Sergei Kuzmenko, senior specialist Roskachestvo at the Center for Digital Expertise for Testing Digital Products, also listed the rules that Russians need to follow when connecting to an unprotected public Wi-Fi network.

For secure work with public Wi-Fi, Kuzmenko advised to turn on VPN. According to him, this will provide an encrypted connection between the device and the Internet. As the expert emphasized, using a VPN is one of the best ways to protect personal information when connected to an open access point.

The Roskachestvo expert also noted that for data security, two-factor authentication should be configured wherever this function is offered. In addition, it is important not to forget to leave accounts after completing work in them in order to protect yourself from these accounts from attackers, the expert concluded.

See also

• Internet access (Russian market)

Notes