Russian Mobile Market Grows

Jul 18, 2014 10:00 AM PST

LOS ANGELES — Averaging more than one active mobile device per person, the Russian mobile market continues to swell and to offer innovative payment mechanisms, providing opportunities for marketers and merchants.

One adult-friendly company that is enabling these new opportunities is txtNation, which earlier this year launched its Russian mobile operator billing solution — offering businesses the ability to process mobile transactions, with high payouts and easy integration.

To aid merchants in understanding the value of this burgeoning market, txtNation has presented some key data about the market and provides compelling reasons for operating there through mobile offers to the 234 million Russian mobile phone subscribers.

According to the company, Russia has the highest mobile device penetration of all the BRIC countries — more than 162 percent — dispersed among a population of more than 143 million. Russia is a big market to enter, which has experienced a lot of growth in the usage of the mobile Internet in recent years, with 31.4 percent of Russians accessing the web via their handsets last year, which is up from 21 percent in 2012 and 17 percent in 2011, showing strong, steady growth.

“In Russia, the majority of mobile Internet users are 18-24 year olds, followed closely by 25-34 year olds. This is a key demographic for mobile payments,” says a txtNation rep. “Credit card payments can cause high drop-off rates, due to the long payment process on mobile, so our Mobile Operator Billing solution can solve this.”

This solution provides mobile web optimized payments, using a seamless payment process.

“We can offer a large tariff range from 1rub to 5000rub as well as full technical and compliance support and dedicated account management to ensure an easy setup process,” the rep explains, adding that the company’s mobile operator billing solution allows client’s end-users to simply enter their mobile phone number and then have the merchant’s services charged to their contract or pre-paid credit account.

MSISDN forwarding allows txtNation to offer single-click mobile payments. The company explains that “MSISDN forwarding” describes the process of a carrier passing along in the page headers the MSISDN of a user visiting a WAP or web page using a mobile handset. Where allowed, having identified the MSISDN of the user and obtaining their agreement to the purchase, a billed message is delivered.

“The user’s mobile number is detected, and they therefore cut out one step of the [payment] process,” the rep adds. “They can simply click a button to pay.”

This one-click billing service is currently available through the MTS network, which according to market research group AC&M reaches significant percentages of key markets, such as Moscow (37 percent) and St. Petersburg (28 percent).

For its part, Vimpelcom reportedly has a respective 35 percent and 21 percent of these cities.

Russia’s second-largest mobile operator, Megafon, claims a respective 27 percent and 33 percent share of the two markets and is expected to roll out a range of next-generation services following its recent $1.2 billion acquisition of Scartel, in hopes of furthering its lead in bringing broadband Internet to Russia.

As more people obtain faster Internet access, the hope is that they will increasingly consume premium content and services — the trick is to profitably offer the right content and services at the right price — and with as little friction in the payment process as possible.

For more information, txtNation offers a new infographic that highlights these data trends. 

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