Google will share with MTS revenue from the sale of applications

As it became known to RBC daily, the American corporation Google has signed a unique contract with MTS on joint promotion of content in Russia. The search engine intends to deduct 25% of the cost of each application downloaded to the Android Market by MTS subscribers, owners of its branded handsets. A similar agreement on joint promotion of Google Play may soon be concluded by another operator of the Big Three - VimpelCom.

MTS and Google signed the first agreement in the Eastern European market on joint promotion of Google Play applications on the MTS network, sources in telecommunications circles told RBC daily. The press service of the operator confirmed this information. As part of the agreements reached, MTS will install the Google Play widget on its branded smartphones based on Android OS. And Google, in turn, will provide MTS with a special section for promoting mobile applications of the operator and its partners.

The company did not disclose the commercial terms of the agreement. But a source in the telecommunications market, familiar with the details of the negotiations, says that Google intends to share with the operator the revenue from each download made by the owners of branded MTS handsets in the amount of 25% of the cost of the application.

The volume of the market for paid applications Android Market in Russia in the next three years may be about 1.5-2 billion rubles., Specifies the interlocutor of RBC daily. But with a new agreement with Google, MTS “will only be able to bite off part of this pie,” the source said. Indeed, the share of sales of MTS branded smartphones in the total sales of smart phones in Russia in 2011 was less than 1%.

Also, another interesting news: VimpelCom is negotiating with Google about paying for applications on Google Play through Beeline carrier billing, that is, from a phone account.The service will be available to all Beeline subscribers using smartphones with OS Android. “Now, for paying for applications, subscribers must use a credit card, which is often a factor that prevents a user from buying,” says Anna Aibasheva, spokeswoman for VimpelCom. - A mobile phone account as a source of payment will eliminate this barrier and significantly increase sales of paid content. For VimpelCom, this is a double advantage - in addition to the commission from the sale of applications, revenue from traffic through 3G networks will increase. ” VimpelCom is conducting this project for the entire group of companies Vimpelcom ltd, she said.