MTS network spend increases

Russian service provider MTS accounted for US$2.90 billion (€2.23 billion) of parent company Sistema’s expenditure last year due to network developments, according to Sistema’s 2012 annual report.

The figure, up from US$2.59 billion last year and equivalent of 23.3% of MTS’ total revenues, came as Sistema warned that MTS faced “increased competition in the cable TV and fixed line business,” with the market for alternative fixed line communications services in Russia rapidly evolving and becoming increasingly competitive.

At the same time, Sistema Mass Media, the holding company that manages assets in pay TV, premium movie and TV content production and advertising, saw sales decrease by 19.8%, from US$101.9 million in the year ended 31 December 2011 to US$81.7 million in the year ended 31 December 2012 due to a reduced sales from the advertising business.