Independent 5-year Consumer Electronics Industry Forecasts for Russia

Russia's consumer electronics devices market, defined as the addressable market for computing devices, mobile handsets and AV products, is estimated at about US$23.95bn in 2011. Volume sales of mobile phones, PCs and digital TV sets have rebounded strongly from 2010 and the consumer electronics market is expected to increase at a CAGR of about 13% to US$39.1bn by 2016.

In 2011, Russian retailers such as M.video, Euroset and Svaznoy reported a strong recovery in sales of consumer electronics devices, continuing on from 2010. The planned roll-out of digital TV broadcasting to 95% of Russian citizens by 2015 and investment in 3G and 4G mobile communications infrastructure will drive spending in the AV, mobile handset and notebook categories.

Computers
Computer hardware accounted for about 43% of Russian consumer electronics spending in 2011. The Russian computer hardware market is forecast to reach US$10.4bn in 2011, continuing to recover after contracting an estimated 26% in dollar terms in 2009. Computer hardware CAGR for the 2011-2016 period is forecast at 14%, driven by rising PC penetration and sales of notebooks and netbooks. Rapid income growth and availability of household credit will sustain an upward trajectory of PC demand. The primary downside risk to this scenario stems from a disorderly outcome to the eurozone crisis.

AV
AV devices accounted for about 31.7% of Russian consumer electronics spending in 2011. Russia's domestic AV device market is estimated at US$7.6bn in 2011. Demand for digital TV sets will drive a projected CAGR of 6.7% in 2011-2015, as Russia makes a gradual, region-based transition towards digital broadcasting. In October 2009, Russian President Dmitry Medvedev announced a target for every Russian citizen to have access to at least 24 digital TV channels by 2015.

Mobile Handsets
Mobile handset sales accounted for about 24.9% of Russian consumer electronics spending in 2011. Russia's handset market revenues are expected to grow at a CAGR of 16.7% to US$11.1bn in 2016, as mobile subscriber penetration reaches 185% and the proportion of higher value smartphone handsets in total sales increases. Sales will be dominated by the replacement market, with smartphones forecast to comprise about 30% of handset sales in 2011. There is a large digital divide between urban centres such as Moscow, where mobile penetration is more than 200%, and rural regions, where penetration is on average closer to 140%.

TABLE OF CONTENTS

Executive Summary  5
SWOT Analysis  8
Russia Consumer Electronics Market SWOT  8
Russia Political SWOT  9
Russia Economic SWOT  9
Russia Business Environment SWOT  10
Business Environment Ratings  11
Table: Regional Consumer Electronics Business Environment Ratings 11
Consumer Electronics Market  15
Computers 16
Table: PC Sales, 2009-2016  16
AV  19
Table: AV Sales, 2009-2016 19
Mobile Handsets  23
Table: Mobile Communications, 2009-2016  23
Top 3 Most Popular Models In Different Pricing Categories In The MTS Retail Network During Q3 2011, % Of Total Units Sold  25
Electronics Industry  29
Table: Russia Electronics Industry, Key Metrics  29
Table: Electronics Output, 2009-2016  29
Table: Russia's Technology Park Expenditure, 2006-2010 (US$mn)  31
Table: Diverse Private Tech Firm Investment Boosts Silicon Skolkovo Dream  33
Table: Electronics Output By Segment, 2009-2016  36
Table: FDI Of LCD TV Set Manufacturers In Russia, 2006-2009  38
Table: Russia Electronics Components Industry – Development Plan 2008-2025  39
Industry Forecast Scenario  40
Consumer Electronics Market  40
Table: Consumer Electronics Overview, 2009-2016  40
Industry Developments 43
Macroeconomic Forecast  47
Economic Activity  47
Table: Russia - Economic Activity, 2011-2016  49
Competitive Landscape  50
Computer  50
Handsets  53
AV  57
Company Profiles  59
Depo Computer  59
Kraftway  61
National Computer Corporation (NCC)  62
Sitronics  64
BMI Methodology  66
Russia Consumer Electronics Report Q1 2012
How We Generate Our Industry Forecasts  66
Electronics Industry  67
Sources  67