Broadband Penetration Increases, but Connections Still Weak in Russia

Faster connections remain a fraction of the total


Russia’s broadband market has seen solid growth in the past few years. eMarketer estimates that the number of fixed broadband households reached 11.9 million in 2011, and is expected to increase 8.6% to 12.9 million in 2012. By the end of this year, a quarter of all Russian households will be wired with broadband, including cable modem, digital subscriber line (DSL), fiber and wireless/satellite technologies.

Fixed Broadband Households and Subscriptions in Russia, 2010-2016

eMarketer estimates that growth rates will begin to level off to the single digits this year, however, and total fixed broadband households will reach 15.7 million in 2016 for a penetration of just over 30%. Subscription growth will also level off, increasing from 13.6 million in 2011 to 18.7 million in 2016.

Russian management consulting firm J’son & Partners was much more bullish on broadband subscriptions. In its March 2012 report on fixed access network technologies, the firm estimated there were 21.7 million households with broadband in 2011, for a penetration of 39%. The broadband household figure is expected to reach 32 million by 2015.

However, Russia’s broadband has some catching up to do in terms of technology. J’son & Partners wrote that most broadband connections were asymmetric digital subscriber lines (ADSL), an older technology that is common worldwide and limits connection speeds. According to the report, fiber connections, prevalent in advanced markets like the US, Japan and South Korea, accounted for only 0.5% of total subscriptions in Russia.

For consumers to embrace broadband and see adoption rates rise, Russia needs better infrastructure and widespread fiber deployment. But in such a geographically vast country, fiber connections are likely a prohibitively expensive investment.