According to the latest research from Counterpoint’s Market Monitor program, in Q4 2015 (Oct-Dec), Russia’s mobile phone market grew by 8% annually. The growth in the market resulted in significant shifts in the competitive environment during the quarter.

The following are the key findings of the competitive environment in Russia during 4Q 2015:

Russia Mobile Phone Market 4Q 2015

• The Russia market registered a strong comeback in second half of 2015, but still declined for the full year due to very weak first half 2015 as the weak Ruble and other macro factors affected the overall economy.
• The Russia mobile phone market grew by 8% annually and 27% sequentially during Q4 2015.
• Smartphone shipments remained almost flat registering a 1% growth annually though up a healthy 13% sequentially.
• The Chinese TCL-owned brand, Alcatel One Touch, became the number one mobile phone brand during the quarter, surpassing Samsung, thanks to stronger demand for its feature phones in Q4 2015.
• The biggest domestic Indian brand, Micromax, which expanded its operations in Eastern Europe a couple of years ago, is now reaping the benefits of distribution and marketing as it captured the third spot for the first time ever with 9% market share.
• However, Samsung led the overall smartphone market during the quarter with a market share of 17%, though down from 21% a year ago.
• Lenovo raced to the number two position, with strong demand for its entry-level portfolio, capturing 11% share, followed by ZTE which climbed to third spot.
• Apple saw demand for its iPhone slow due to the weakening economy and stronger Ruble, making it quite an expensive offering. However, the Cupertino vendor still maintained its position in the top five smartphone brands in Russia in Q4 2015.
• Fly Mobile, which has enjoyed success in last three years in Russia, becoming one of the most popular mobile phone brands, also lost share at the expense of the upstart Asian brands. But it still maintained its position in the top five rankings in Russia.
• Russian operators such as Megafon and MTS have raced ahead in 2015 to expand their 4G LTE footprint. However, only one in four smartphones sold were LTE capable. There is consequently a lot of room for LTE shipments to grow compared to other emerging markets such as India where LTE smartphone shipment demand has skyrocketed in spite of there not being any meaningful LTE coverage.
• Russia’s smartphone market has seen strong recent traction from Chinese brands, which have expanded to new geographies as their home market saturates.
• Chinese brands captured close to 30% of the total smartphone market during the quarter.
• Close to sixty brands are competing in the market. Some of the key local brands to keep an eye on include: Dexp,BQ and Prestigio.

Exhibit 1: Russia Mobile Phone and Smartphone Shipments

Source: Counterpoint Research Market Monitor Q4 2015 Report

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The Market Monitor research is based on sell-in (shipments) estimates based on vendor’s IR results, vendor polling triangulated with sell-through (sales), supply chain checks and secondary research.