Telecommunication Revenues Grow 30% In 2005.

The telecommunication sector more than doubled the performance of the Ukrainian economy (we estimate nominal GDP growth to be 13%). The main driving force was the mobile sector, which boosted the LD (mainly fixed-to-mobile) sector.

Telecommunications Sector Revenues

 

USD mln

Change yoy

Local

550

-0.1%

LD

1,312

9.8%

Internet/data

200

8.0%

Mobile

2,874

53.0%

Total

4935

29.6%

Source: State Statistics Committee

Concorde Capital: The mobile market is close to its saturation point, thus we expect its growth rate to decrease in 2006. Saturation will also imply tougher competition between mobile operators, and further decreases in mobile tariffs. This will stimulate a switch from fixed operators to mobiles, and negatively affect revenues for fixed operators. However, fixed operators will be able to stimulate their VoIP services, and raise revenues from the data segment in 2006.