Venus shaydullina — Director of the Center for studies and examinations of the Department of legal regulation of economic activities, Financial University under the Government of the Russian Federation

The digital content market appeared about 20 years ago and in that time has become one of the largest segments of the economy. Goods serve as informational and entertainment content: audio, videos, texts, games, apps. For trade virtual platforms, the files are distributed via digital channels. Trade of digital content in Russia is growing rapidly. According to the Center for studies and examinations DPRed the Financial University under the Government of the Russian Federation in 2018, 22% of Russians bought digital content. In 2015, the comparable figure was 6%. Users have described the reasons why they choose paid content:

Quality. When selecting paid content, users are sure to get the film in high definition, and not “cut on the knee”, a text file, not a scanned book, etc.

Speed. Buying content does not need to waste time searching for files on pirate sites.

Security. When downloading the file from the official online there is no risk to download a virus.

Only 9% of people admitted that pay for content regularly. The main reason why people refuse to pay for the materials, is the low level of income and a misunderstanding of copyright. Some of the respondents said that they do not trust any online purchases.

Pay music

The first service in the sale of electronic music in Russia launched Yandex. The service “Music” started in 2010. 2 years later there was an application for listening to music on phones. In 2018, the number of audience “Yandex. Music” made 20 million people. Paid subscription are connected at a 1.75% of the audience. In 2013, the Russians became available to Google Play Music, which also has a mobile version. In 2015, Apple introduced the Apple Music service to buy music tracks from the iTunes Store. In 2018, the number of Russians who buy music online on any service that does not exceed 1 million. This trend will continue and 2019-2020

Video

The largest participant in the market is Netflix. Service audience reached 130 million people from 190 countries. Popular video services in Russia: Megogo, Ivi, Okko, “Amediateka”. The largest Russian Megogo service offers paid access to movies and online TV.

According to our estimates, from 68% to 83% of people watching video from mobile phone. These people prefer short videos and long video looking for a few sessions. To attract users ‘ attention, you need to offer multiple videos to make a convenient search directory. In 2017 net profit “the Megaphone TV” was 60%. The profit of the company “Megalabs” increased by 90%. Production and sale of videos is a promising direction of e-Commerce. According to the Agency Sandwine, streaming video accounts for 58% of incoming and 23% of outgoing traffic. The increase in the consumption of video content is observed in all countries.

Games and apps

The main venue for purchasing mobile games & apps — Google Play and App Store. Games for a laptop can be purchased on Steam or Origin (EA Games) for console Play Station Plus or Xbox Live Gold. On the Internet there are a lot of online games with a subscription for access or extra features.

In 2018, the App Store profit amounted to $42.5 billion. This is 2.5 times more than the profit from Google Play. The difference caused by high paying customers to Apple. In 2020 it is planned to increase income from the App Store for $20 billion. In 2013, the residents of the CIS for the first time spent more money on games than on movies. The most popular were online games multiplayer (30% of the market). On the second place — social apps (26% of the market). According to our data, in 2018 every 4 Russians playing computer games. The volume of the Russian market amounted to $39 million. Russia came in first place in the world for buying game content. According to forecasts, in 2019 the market will exceed $55 million.

Books and audiobooks

The market share of electronic books “Litres” and Bookmate. Their foreign competitors have not yet mastered the Russian market. The sale of the company “Litres” in 2018 increased by 47%, while more than 50% of purchases were made from mobile devices. According to our research, in 2019-2020 59% of Internet users will read paid and free books, and 23% of people will read only the paid books. The main reason for this choice is the desire to reward the author for the work.

Electronic media
In 2011 in Russia there is paid media. The newspaper “Vedomosti” created for the site with premium articles. Two years later paid subscription has entered the channel “Rain”. In 2014 there was a project Slon is now known as the Republic. Revenue of the Republic amounts to 4.6 million rubles per month. The project signed by 20,000 users. According to the site “Journalist”, the third edition of the world offers a paid subscription. Editions publish part of the materials for free, so readers can evaluate the quality of articles, and offer subscriptions to the private paid section. The average profit electronic publications is growing at 8-12% per year. Some publications offer readers to make a voluntary payment to the development of the resource. In such a scheme work “the Media” and “New newspaper”. According to research by the Reuters Digital News Report, 14% of Internet users have ever subscribed to a paid article.

Prospects trade content

In the former Soviet Union the market for digital content is growing slowly. In Russia, the low purchasing power of the population, developed culture of piracy. According MUSO Reveals that our country ranks second in the world for the consumption of pirated content. At the same time, experts predict the growth of e-Commerce the next 3-4 years.

What factors will contribute to the development of the digital market in Russia:

Tougher anti-piracy legislation. Lock pirated resources.

The increase in the audience of paying customers of the Internet.

Raising civic awareness. Understanding the value of copyright.

Improving the quality of the material and the provided services thanks to competition in the industry.

Increasing confidence in electronic payment systems. The spread of electronic money.

According to the forecast Megogo, the rate of growth of the Russian market will be 10% for the year. The biggest profit will get the sites aggregators of various types of content. According Relap, the Russian market rose from 100 billion rubles in 2011 to 234 billion rubles in 2016. Analysts say that the positive dynamics will be maintained.

What business to do?

A large part of the digital content market belongs to corporations. Compete with them on equal terms is quite difficult. The chance of success is the business that will offer customers high-quality content, convenient service, innovative solutions.

How to achieve success in trade market, content in 2019:

To publish some content for free so that users can evaluate the quality.

To create a convenient service for viewing content on different devices.

To provide a convenient payment option, to use a different payment system.

In a timely manner to resolve all technical glitches and bugs in the website.

To offer to subscribe, not to sell individual files.

Not to sell political advertising and other customized content.

Not to publish the materials prohibited by the legislation of the Russian Federation.

To engage in dialogue with clients, respond to suggestions and negative feedback.

According Okko, 300 rubles — the maximum subscription amount acceptable to customers.

To enter the Russian digital content market will be difficult, but possible. In Western countries before the beginners in business are higher barriers. In order to achieve success in the market, need to develop competitive advantages and offer quality materials at a low price.

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