Operating review

Revenue structure by services1


RUB million FY 2011 FY 2010 %
change,
y-o-y
Local telephony services 88,018 85,396 3%
Intra-zone telephony services 21,447 23,358 (8%)
DLD/ILD telephony services 24,070 27,939 (14%)
Interconnection and traffic transit services 20,202 19,703 3%
Broadband Internet 46,993 39,215 20%
Pay-TV 7,011 1,102 536%
Mobile communication services 35,560 33,872 5%
Data services (VPN, data centres, wholesale Internet sales) 18,929 17,191 10%
Rent of channels 9,756 9,149 7%
Other 24,029 18,806 28%
Total revenue 296,015 275,731 7%

Revenue structure by customer segments


RUB million FY 2011 FY 2010 %
change,
y-o-y
Residential customers 160,444 154,787 4%
Corporate customers 69,774 62,175 12%
Governmental customers 34,484 28,445 21%
Operators 31,313 30,324 3%
Total revenue 296,015 275,731 7%

The Company generated a 7% year on year increase in revenue for the year to date to RUB 296.0 billion, which reflected:

  • a 20% year on year growth of revenues from broadband services in line with the growth in subscriber base;
  • a more than six times growth in revenues from Pay-TV services, primarily due to the consolidation of cableTV subscribers of newly acquired operators and development of IP TV services in line with the modernization of broadband networks;
  • a 28% year on year increase in other revenues, mainly as a result of increased income from lease of infrastructure as well as the Company’s contribution to the electronic government service.

Key operating indicators


Number of Subscribers (millions): FY 2011 FY 2010 %
change,
y-o-y
Local telephony 28.5 29.4 (3%)
Mobile telephony2 12.5 12.0 4%
Broadband Internet access incl. 8.2 6.7 24%
Residential 7.6 6.1 25%
Corporate 0.6 0.6 9%
Pay TV 5.9 0.9 540%
       
Traffic, generated by residential and corporate subscribers3
(billions of minutes)
Intra-zone
2.7 3.0 (9%)
DLD 1.3 1.6 (15%)
ILD 0.1 0.2 (17%)

The broadband and Pay-TV subscriber bases continued to grow, both on an organic basis due to the increased penetration of broadband and pay-TV services among local telephony subscribers, and as a result of the acquisition of telecom operators.
The total broadband subscriber base was up 24% year on year to 8.2 million, while the total Pay-TV subscriber base increased almost by seven times year on year to 5.9 million.
The number of mobile telephony subscribers increased by 4% year on year to 12.5 million. The increase resulted from the consolidation of the remaining 50% in Volgograd GSM in fourth quarter of 2011. Rostelecom's total subscriber base for local telephony services was down 3% year on year. The decrease was mainly due to the ongoing change in customer patterns regarding the use of traditional fixed-line services.

1 Effective from April 1, 2011, the methodological changes in the revenue structure include the following: 1) revenues from DLD/ILD traffic transit , which were previously included in the “DLD / ILD telephony services” reporting line, are now included in the “Interconnection and traffic transit services” reporting line; 2) revenues from mobile interconnection services, previously included in the “Interconnection and traffic transit services” reporting line, are now presented under “Mobile Communication Services”; 3) other methodological changes have had no significant impact on the reporting structure.
2 Excluding Skylink Group (subsidiary of Svyazinvest)
3 Excluding traffic, generated by other telecom operators

History

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