MTS blog


Thursday, October 14, 2010


It was recently announced that the Moscow City Telephone Network (MGTS), the incumbent PSTN operator in Moscow and owned by Mobile TeleSystems (MTS) through its majority ownership of Comstar-UTS, will invest RUB 13 billion in the modernization of its fixed line network between now and 2013. The digitalization will allow the company to decrease its maintenance costs for analogue exchanges, modernize its business processes, optimize employee levels and boost overall efficiency.

We asked Sergey Ivanov, the CEO of MGTS, to elaborate on what the company plans to accomplish through the modernization program.

What is the percentage of digital lines in the MGTS network, and when does the company plan to complete the digitalization process?

As of the beginning of 2010, 63% of our active lines were digitalized. If we maintain the current pace of modernization, we will be able to reach the 100% level by the end of 2013.

How are you going to utilize the space that will become free following the replacement of analogue equipment with digital lines?

A significant effect from the execution of our modernization program will be the freeing up of space from under the automatic telephone exchanges through use of more compact equipment. We are already leasing out 50 000 sq. meters of office and utility space, which brings in more than RUB 0.5 billion of extra revenue annually. We expect this number to increase to up to RUB 2 billion during 2011-2013 as we continue to modernize the network. We are considering different options of utilizing unoccupied spaces, most of which are located in areas with significant investment potential, including leasing out the space outright, leasing it out after making minimal investments, or modernizing the space before leasing it out.

Starting this year, the numbering capacity being introduced is based on the IP Multimedia Subsystem (IMS) technology. Which new services will be made available to subscribers with the introduction of this technology, and when do you expect to launch them?

Based on this technology, an IMS gateway will be installed in each apartment that will provide access to modern fixed-line services (landline, Internet access, and IPTV) as well as additional high quality services (caller ID, call waiting, call forwarding, SMS, etc.).

How does MGTS as the main provider of fixed-line services and a key player in the broadband market benefit from the IMS technology?

IMS is a technology that enables us to simultaneously digitalize the MGTS network and to deliver broadband access to every single apartment in Moscow. Every apartment connected using the IMS technology will have broadband access – both fixed broadband and wireless using Wi-Fi – on top of the regular landline. Once the IMS gateway is installed, it becomes much easier to connect various services, in fact it is already connected, and it is only a matter of actually starting to use it. The IMS technology enables us to significantly decrease investments in network digitalization and to employ innovative technologies.

The MTS infrastructure also uses the IMS technology. Are there any synergies to be realized from MGTS introducing IMS?

The IMS architecture provides a base for convergent solutions for both fixed and mobile services. At this stage we are building up the technological base, but subsequently we will be offering our subscribers convergent solutions, including IMS-based ones.

How will MTS boost sales through integration with MGTS? How does the Group cross-sell services and which bundled offerings will be available to the subscribers?

Already today customers can pay for MGTS’ fixed-line services (local and long distance calls, broadband and TV) and MTS’ mobile services using a unified MGTS bill; payments can be made in the MTS stores. In addition, MTS SIM-cards are distributed in the MGTS offices. In early 2010 sales of a broadband package from MGTS were launched through the MTS retail chain. In the future we will be offering more bundled services.

(Text translated from Russian to English by MTS)

Please download the MGTS presentation here:

 Modernization of the MGTS

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Friday, October 08, 2010

We have recently launched in Russia a new service called EasyPayment. The subscribers can now pay for different  services, both MTS’s and other companies’ using their mobiles by transferring funds from either their bank or personal accounts with MTS. EasyPayment allows payments for municipal services, cable TV, landline, Internet and many others with low to no commission.

Each transaction takes 1-2 minutes with the minimum transaction amount equal to RUB 10 and the maximum to RUB 15,000 for payments from a MTS personal account and up to RUB 30,000 for payments using a bank account.

The user interface for payments allows a greater degree of flexibility as subscribers can now use special applications developed for handsets on the Windows Mobile, Symbian and iPhone operating systems. The Android version is currently being developed. The applications can be downloaded following receipt of a SMS message containing a link to the download page. iPhone users can find the application in the Apple App Store. The subscribers also can make payments using a web-portal or the USSD-service*.

For EasyPayment, MTS partnered with the Bank of Moscow, 1st Processing Bank, a supplier of e-commerce solutions Intervale and the QIWI payment system.

EasyPayment is an improvement from a previous service MTS-Pay that was launched in October 2008 and allowed subscribers to only transfer funds using their bank accounts. In June 2010 we won the prestigious Global Telecoms Business Innovation Award in the “Consumer bank-card innovation” for MTS-Pay.

We consider the mobile payment market in Russia to have good growth prospects on the back of strong existing demand. Given the country’s high wireless penetration and the relatively low credit card penetration and indeed use, services such as MTS’ EasyPayment that allow to use mobile accounts to make payments could play an important part in the development of mobile commerce in Russia. Our projects in this field include money transfers (launched in April 2010); as well as the partnership with the Moscow Metro allowing passengers to buy  tickets using their mobiles at the turnstiles utilizing the NFC** technology (tentative launch at the end of 2010).



* USSD - Unstructured Supplementary Service Data.
** NFC - Near Field Communication.

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Monday, October 04, 2010

Global Telecoms Business (GTB), a leading telecommunications trade magazine, ranked MTS President and CEO, Mikhail Shamolin, the 26th most powerful telecommunications professional globally in its annual “Power 100” list of leading industry executives. The 2010 ranking, determined by reader-submitted nominations, is an improvement from last year’s placing of Shamolin at #29. GTB acknowledged several milestone achievements at MTS over the past year as the cause.

GTB wrote:

“Mikhail Shamolin is the president and CEO of MTS, which operates in Russia and the CIS. Since May 2008, Shamolin has driven corporate transformation through MTS’s entrance into fixed-line services through the acquisition of Comstar-UTS, the provider of integrated telecommunication solutions in Russia, and the launch of, an online content portal.

“During Shamolin’s tenure, first as head of MTS’s Russian business and then CEO of MTS, the company’s core markets have delivered nearly 20% compound annual revenue growth since 2005 and developed into the world’s ninth largest telecommunications company by subscriber numbers.”

The full 2010 ranking is available on GTB’s website.

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Tuesday, September 28, 2010

The Russian business daily Kommersant has recently published its 11th Annual Ranking of Russia’s Best Managers. We are happy to announce that three of MTS’ top executives were selected as leaders in their respective categories. Mikhail Gerchuk, Vice President and Chief Commercial Officer, was chosen as the Best Marketing Director for the year 2010. Sergey Nikonov, Vice President for Human Resources and Administration, was recognized in the Best Human Resources Director category, and Ruslan Ibragimov, Vice President for Corporate and Legal Matters, was selected as the Best Corporate Governance Director.

The ranking is Kommersant’s joint project with the Russian Managers Association, a nation-wide independent non-governmental organization, which identifies the best professionals in Russia among managers across different industries based on the evaluation of their professional reputation during the year. The rating also takes into consideration the weight of each candidate’s industry in the country’s gross domestic product and his/her citation index in Russian mass media. The initial number of candidates in the running for this rating at times exceeds 5,000 people. This number is then reduced to 2,000 and then to 1,000 for final consideration. The principle of the rating is simple – "The Best choose the best" – with the jury made up of industry experts.

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Tuesday, September 21, 2010
Today, we have released our subscriber numbers for the month of August 2010. Below is a table outlining the dynamics of our customer base.

Subscribers (mln) Aug 31, 2010 Jul 31, 2010 Growth
Aug 31, 2009 Growth
Total consolidated subscribers, eop 99.57 99.21 0.35 0.4% 96.17 3.40 3.5%
Russia 69.11 69.30 (0.19) (0.3%) 68.26 0.85 1.2%
Ukraine 17.99 17.71 0.29 1.6% 17.77 0.22 1.2%
Uzbekistan 7.96 7.81 0.15 1.9% 6.67 1.28 19.2%
Turkmenistan 2.33 2.24 0.09 3.8% 1.41 0.92 65.3%
Armenia 2.18 2.15 0.02 1.2% 2.05 0.12 6.0%
MTS Belarus1 4.62 4.60 0.02 0.5% 4.50 0.12 2.6%

Subscriber data for Russian mobile operators is compiled by Advanced Communications and Media, a management consulting and research agency specializing in telecommunications and media. You can view their August subscriber report here.

1 MTS owns a 49% stake in Mobile TeleSystems LLC, a mobile operator in Belarus, which is not consolidated.

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Thursday, September 16, 2010

We are pleased to announce that earlier this week MTS launched an automatic payment system that provides the Company’s subscribers with the option to top-up their mobiles by debiting bank accounts. The new service is called Auto-payment and allows users to make automatic money transfers to their mobiles by pre-specified amounts upwards to a maximum of RUB 10,000 once a mobile account reaches a RUB 30 level. No commission is charged for the transaction.

The service is being provided in partnership with Sberbank, the largest credit institution in Russia and CIS. With over 20,000 branches across Russia, Sberbank is an ideal partner in this undertaking.

The service is already available in Moscow and will be launched in other cities in the near future.

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Thursday, August 19, 2010
Today, we have released our subscriber numbers for the month of July 2010. Below is a table outlining the dynamics of our customer base.

Subscribers (mln) Jul 31, 2010 Jun 30, 2010 Growth
Jul 31, 2009 Growth
Total consolidated subscribers, eop 99.21 98.82 0.39 0.4% 95.65 3.56 3.7%
Russia 69.30 69.42 (0.12) (0.2%) 67.93 1.37 2.0%
Ukraine 17.71 17.52 0.19 1.1% 17.79 (0.08) (0.5%)
Uzbekistan 7.81 7.59 0.22 2.8% 6.55 1.25 19.1%
Turkmenistan 2.24 2.17 0.08 3.6% 1.33 0.92 69.2%
Armenia 2.15 2.13 0.03 1.3% 2.04 0.11 5.4%
MTS Belarus1 4.60 4.58 0.02 0.4% 4.50 0.09 2.0%

Subscriber data for Russian mobile operators is compiled by Advanced Communications and Media, a management consulting and research agency specializing in telecommunications and media. You can view their July subscriber report here.

1 MTS owns a 49% stake in Mobile TeleSystems LLC, a mobile operator in Belarus, which is not consolidated.

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Wednesday, August 18, 2010

We are pleased to announce that this past Monday we became the first company to launch the BlackBerry® solution in Armenia. The move was made possible through a partnership with Emitac Mobile Solutions (EMS), a Dubai based solutions and service provider and a strategic channel partner of Research In Motion (RIM). Coupled with the speeds offered by our 3G network, which is now operational in 50 towns and cities across Armenia, our customers will be able to fully satisfy their mobile and information needs by using the BlackBerry® solution.

We will offer the BlackBerry® Enterprise Server (BES) for corporate customers and the BlackBerry® Internet Service (BIS) for smaller businesses and individual users. The initial portfolio of handsets will consist of three models – BlackBerry® Bold™ 9700, BlackBerry® Bold™ 9000 and BlackBerry® Storm 2™ 9520.

A tariff plan for BIS users will carry a monthly fee of AMD 9,900 (around $27) and will include 500 free on-net minutes and 500 free on-net SMS as well as unlimited access to the email and messaging.

BlackBerry Enterprise Server is designed for organizations that manage their own email servers. The BlackBerry Enterprise Server software tightly integrates with IBM® Lotus® Domino®, Microsoft® Exchange and Novell® GroupWise® and offers advanced security and IT policy controls to enable secure, push-based wireless access to email and other corporate data.

BlackBerry Internet Service is designed for smaller businesses and individuals. It allows customers to access up to 10 supported corporate and personal email accounts (including most popular ISP email accounts such as Yahoo! Mail, Microsoft Live and Google Mail) from a BlackBerry smartphone.



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Thursday, July 22, 2010
Today, we have released our subscriber numbers for the month of June 2010. Below is a table outlining the dynamics of our customer base.

Subscribers (mln) Jun 30, 2010 May 31, 2010 Growth
Jun 30, 2009 Growth
Total consolidated subscribers, eop 98.82 98.98 (0.16) (0.2%) 95.03 3.79 4.0%
Russia 69.42 69.85 (0.43) (0.6%) 67.42 2.00 3.0%
Ukraine 17.52 17.44 0.08 0.4% 17.78 (0.26) (1.5%)
Uzbekistan 7.59 7.48 0.12 1.5% 6.53 1.06 16.3%
Turkmenistan 2.17 2.10 0.06 3.1% 1.25 0.91 72.8%
Armenia 2.13 2.11 0.01 0.5% 2.05 0.08 3.9%
MTS Belarus1 4.58 4.56 0.02 0.3% 4.48 0.09 2.1%

Subscriber data for Russian mobile operators is compiled by Advanced Communications and Media, a management consulting and research agency specializing in telecommunications and media. You can view their June subscriber report here.

1 MTS owns a 49% stake in Mobile TeleSystems LLC, a mobile operator in Belarus, which is not consolidated.

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Wednesday, July 07, 2010

We are proud to share two articles in the Financial Times published this week, reporting on MTS and our content portal, We have talked about in this blog before and it has recently received Meffys award.

During our trip to New York to celebrate the 10th anniversary of listing on the NYSE, Mikhail Shamolin, President and CEO of MTS, met with the Financial Times journalists. Mikhail talked about content distribution in Russia, how we can overcome the piracy grip, and why MTS has a window of opportunity to carve a strong position in the potentially lucrative content market.

Here are the articles:

Financial Times, Russian Omlet mushrooms with legal downloads

Financial Times, Russia’s MTS in talks to boost web content

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