Samsung is the world’s most successful smartphone manufacturer and the popularity of its smartphones are not limited to any particular region either. Russia is one country where the popularity of its smartphones has now forced a rethink for at least one wireless carrier that had started a boycott of its products last year after an unseemly spat with the South Korean company over the pricing of its products. VimpelCom Ltd., the country’s third-largest wireless carrier, has now announced that it will start selling Samsung devices again after a gap of over a year, because of the growing popularity of the company’s handsets among Russian consumers.
While the second largest carrier in the country, MegaFon PJSC, also stopped selling Samsung products in a boycott simultaneously orchestrated by the two telecom operators in May, 2015, the company is yet to resume sales of Samsung devices on its network. The carrier, however, did confirm to the media that it is considering getting Samsung products back in its portfolio, but gave no specific timeline for that to happen. Euroset, a retail chain jointly owned by VimpelCom and MegaFon, has also been a part of the boycott, but there’s no word right now on whether it will get Samsung devices back on its shelves any time soon.
Trouble erupted last year after VimpelCom and MegaFon expressed resentment over the large discounts being offered by Samsung to the country’s largest wireless carrier, Mobile TeleSystems PJSC. According to reports, the discounts allowed the market leader to sell Samsung smartphones at huge concessions that the two competitors failed to match. Rather than selling the phones at prices higher than what their largest competitor was offering, the two decided to stop carrying Samsung products on their networks altogether. However, that didn’t seem to affect Samsung a whole lot, as the company sold 26.6 million smartphones in Russia last year as opposed to 27.5 million units the year before.
While overall revenues fell from $6.3 billion to $4.4 billion over the same period, that was more a factor of the depreciation of the local currency than a substantial drop in sales on account of the boycott. What is pertinent, however, is that the South Korean company recently increased its market share in the country from 18% in Q4 2015 to 25% in Q1 2016, if a report from IDC is anything to go by. Although Russians have traditionally bought their handsets from independent retailers rather than getting bundled devices from carriers, the market is apparently moving to a carrier-led model much like the U.S. That means Samsung will be only too happy to get back on the shelves of all the major carriers in the country.