What the End of Roaming in Russia Means: Key Points

By Riley ThompsonTechnology News

What Does the End of Roaming in Russia Mean?

You’ve probably already heard that Russia is planning to eliminate roaming charges. This is great news for anyone who frequently uses their mobile operator’s services while traveling or on vacation. Personally, this news doesn’t affect me much. In fact, this is standard practice—roaming has already been abolished in the USA, EU, and China. Still, let’s briefly break down what this change means.

  • This is an initiative by the Federal Antimonopoly Service (FAS).
  • Roaming services make up about 4-6% of mobile operators’ revenue (according to “Expert,” No. 36, 2017).
  • Plans that include roaming are usually a bit more expensive.
  • Many people have experienced unexpectedly high bills when calling from one city (or country) to another without activating roaming. Roaming rates for calls to another operator can be up to 1,000 times higher. This means that the actual profit operators make from roaming could be even higher than the numbers suggest. For example, MegaFon’s rate for servicing other operators’ customers can be inflated by up to 3,000 times, Beeline by up to 1,970 times, Tele2 by 5,250 times, and MTS by 22 times (according to “Expert,” No. 36, 2017).
  • Mobile service prices are already rising. According to the analytics agency Content Review, the average mobile tariff has increased by 14-15% over the past year.

Conclusion

The end of roaming will lead to a loss of profit for mobile operators, though not a huge one (on average, about a 5% decrease in gross profit). Another issue for operators is complying with the Yarovaya law, which brings additional long-term expenses for building and maintaining infrastructure (over 3-5 years). All these factors—decreasing revenue and increasing costs—will inevitably affect both current and future tariffs. So, you can expect mobile service prices to rise in the near future.

P.S. To be honest, mobile service is still very cheap, and any price increase is unlikely to be significant. This note is for those who might be upset about rising tariffs and want to know the reasons behind it.