2016 Ukraine - Telecoms, Mobile, Broadband and Digital Media - Statistics and Analyses

Ukraine’s telecom sector returns to revenue growth

Ukraine’s telecoms market is supported by a population of almost 46 million. National telecom infrastructure continues to be modernised through considerable investment in fibre infrastructure. Competition is provided from a number of alternative operators, though each sector is dominated by only a few players. The sector has attracted foreign investors, including SCM Group acquiring Ukrtelecom and Turkcell now owning 100% of the mobile operator lifecell. The telecom market returned to revenue growth in 2015, though the ongoing economic crisis has caused considerable difficulties for operators as subscriber scale down spending on services. The annexation of Crimea by Russia, compounded by the difficult operating conditions in parts of eastern Ukraine, has further exacerbated these problems, and telcos have had to write down substantial losses.

Ukraine’s sizeable broadband market enjoys effective cross-platform competition. DSL remains the dominant access platform, though cable is also widely available and there has been considerable investment in FttP and FttB infrastructure in recent years.

The competitive mobile market is dominated by the three network operators Vodafone Ukraine (formerly MTS Ukraine before being rebranded in late 2015), VimpelCom’s Kyivstar and Turkcell’s lifecell. Some market consolidation is likely later in 2016, with Vodafone Ukraine having made a bid for Ukrtelecom’s mobile subsidiary TriMob at the beginning of the year.

The MNOs have held back the development of the MVNO sector by promoting their own low-cost subsidiaries. Mobile Number Portability has yet to make an impression, with the process to select the company to operate the facility, completed in early 2016, being reviewed by the Antimonopoly Committee. The mobile broadband sector has also been slow to develop. Partly due to economic uncertainties, operators delayed launching 3G services until mid-2015, while commercial LTE services will not be available until after the auction of suitable spectrum in 2017.

This report provides an overview of Ukraine’s telecom market, including profiles of the major operators, a review of telecom network infrastructure, regulatory measures, and emerging network developments. It also covers the broadband and digital media sectors, assessing market developments and the rollout of fibre infrastructure to support bundled services. In addition the report assesses Ukraine’s mobile voice and data markets, offering a range of statistics as well as profiles of the key players, and a review of services and an analysis of anticipated growth in the mobile broadband sector in coming years.

Key developments:

• Astelit is rebranded as lifecell;
• NCCIR prepares to auction spectrum in the 2.3GHz-2.4GHz and 2.5GHz-2.7GHz bands for LTE; Vodafone Ukraine makes bid for Ukrtelecom’s mobile unit TriMob;
• MNP operator under scrutiny by the Antimonopoly Committee;
• Modern Times Group agrees to sell the Viasat Ukraine pay-TV business;
• Volia acquires the W-Fi operator Normatek;
• Ukrtelecom launches fibre-based services for the SME market;
• Volia expands 150Mb/s cable broadband service;
• Kyivstar’s fibre network extended to 4.5 million premises;
• Ukrtelecom begins three-year network upgrade project with Huawei, secures renewal of its local telephony licence;
• Telecom revenue growth returns in 2015;
• Legal amendments to Telecoms Law widens regulator’s powers;
• Number of fixed lines dips below nine million;
• Report update includes the regulator market data, State Statistics data to January 2016, telcos’ operating and financial data to Q4 2015, recent market developments.

Companies mentioned in this report:

Kyivstar, Ukrainian Radio Systems, lifecell (Astelit), Vodafone Ukraine (MTS Ukraine), Ukrtelecom, VimpelCom (Beeline, Kyivstar), Golden Telecom, PAN Wireless, Volia Cable, Datagroup, Eurotranstelecom, , Velton Telecom, Intertelecom, ITC, Telesystems.