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Oddly enough, Samsung has a whole gang of Russian telecoms operators boycotting their products after the company struck an unnerving deal with Mobile TeleSystems PJSC, the country’s largest carrier, for bulk smartphones.
You see, Samsung sells product at bulk in exchange for a discount. The more you buy, the cheaper you get it for. That’s standard wholesale stuff. The problem is, the discount Mobile TeleSystems enjoyed could only be obtained after hitting a certain volume, and it was a volume that was much harder for the other companies — MegaFon and VimpelCom — to match.
As such, Mobile TeleSystems sold the phones for cheaper than the competition was able to, which in turn gave them a big advantage as consumers looked to save a buck. We aren’t surprised, then, that the companies refused to buy Samsung phones due to the disadvantage.
But apparently, Samsung’s phones are so popular that the boycott is over, as VimpelCom confirmed that they are once again ordering from Samsung, and MegaFon is in talks to do the same down the line. It lasted for about a year, and Samsung didn’t budge on their sales tactics.
In that time, the company has sold more smartphones in Russia than they ever have on the heels of some of their most impressive financial growth in years. Samsung alone helped Mobile TeleSystems increase smartphone sales by 63% in the country, and Samsung went from 18% to 25% market share in just one quarter thanks to the successful launch of the Galaxy S7 line.
With those 2 phones still selling strong and the Samsung Galaxy Note 7 on its way, the other guys seem quite eager to get a small piece of that big pie instead of missing out on the meteoric rise that was unofficially exclusive to Mobile TeleSystems.
[via Bloomberg]
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