Russian mobile operator Mobile TeleSystems (MTS) is to launch a nationwide satellite TV service by the end of the year.
The company has partnered with Sistema Mass Media (SMM), one of the largest media holdings in Russia, to offer the service.
SMM is…
Russian mobile operator Mobile TeleSystems (MTS) is to launch a nationwide satellite TV service by the end of the year.
The company has partnered with Sistema Mass Media (SMM), one of the largest media holdings in Russia, to offer the service.
SMM is owned by Sistema JSFC, MTS’ parent company.
Under the partnership agreement, SMM is providing the satellite broadcast licenses and has secured the satellite channel lease arrangements while MTS is managing the project, working with the content owners and overseeing the construction of the infrastructure on the ground.
The service is leasing capacity from Asia Broadcast Satellite’s ABS-2 satellite, which covers 95% of the territory of Russia.
The spacecraft recently suffered an anomaly to one of its high-powered Ku-band beams focused on Russia, prompting ABS to file an insurance claim worth more than US$200m. However, an MTS spokesperson said that the issue would not affect the broadcast of its DTH service.
MTS is to offer subscribers 160 satellite TV channels, including 30 HD channels, a WiFi-enabled smart set-top-box providing time-shift and video-on-demand capabilities, and an integrated MTS SIM card. The base subscriber package is priced at Rbs1,200 (US$26) per month.
Commenting on the launch, Vasyl Latsanych, MTS VP and chief marketing officer said: “In line with our strategy to leverage our mobile, fixed and retail networks to expand into complementary lines of business, MTS is entering the satellite TV market and will focus on developing satellite TV offerings in the areas where digital cable TV is not available.”
MTS currently offers both cable and mobile TV services and is targeting becoming the second-largest DTH provider in Russia within a couple of years.
To achieve this, the company intends to utilize both its brand as well as its existing sale infrastructure, including its billing, call center and marketing operations. The mobile operator also has a retail network of 4,100 stores across the country.
The spokesperson added that the company will invest Rbs5bn-Rbs6bn (US$110m–US$130m) in its satellite project between 2014 and 2016.
MTS is also still considering potentially acquiring Moscow-based DTH firm Raduga TV, whose shareholders have been looking to sell it. But the spokesperson said there remained certain legal risks connected with acquiring the company.
According to a recent market forecast on the Russian pay-TV market by J’son & Partners Consulting, in the first half of 2014 the pay-TV subscriber base in Russia grew by 6% to 37.1 million. This represents a penetration rate of 68%. The consultancy predicts by 2018 this will increase to 83% or 45.3 million households.