Country Snapshot: Russia

Marc Jarrett
Nearly twice the size of Canada, Russia is the world's largest country, extending over a vast expanse of Asia and Europe.

It has the world's eighth-largest population, with some 142m inhabitants. Furthermore, Russian speakers also live in the neighboring countries that were once part of the USSR, before the Berlin wall fell back in 1989.

The subsequent transformation from communism to capitalism has made a handful of tycoons such as 'oligarch' Roman Abramovich very rich indeed — according to Forbes Magazine, he has a net worth of some $18.2 billion, and is now the UK's richest man.

The disparity between the rich and poor is enormous, with the vast majority of Russia still having to survive on pitifully low pay - the average monthly wages there last year stood at just 8,162 rubles, or about $285.

However, 16.5% of the population, about 23.7m people, are already online, and as with all developing countries, this figure is expected to continue growing exponentially in the months and years ahead.

Credit card penetration in Russia is low, with "only about five million active credit-card accounts," according to Brunswick UBS Warburg. Russians would rather use pre-paid cards, rather than credit cards, especially when buying items online.

Online fraud is still all-too commonplace, with no shortage of opportunists wanting to make a quick buck, in this, the new land of corrupt Übercapitalism, where who know is still more important than what you know.

One billing mechanism that is still relatively secure, however, is that of phone billing. Chargebacks here are practically unheard of, since failure to pay their phone bill will result in the termination of an essential utility which probably also facilitates their connection to the Internet.

Russian is the official language, with knowledge of English restricted to the educated classes who are a minority, so when pitching these surfers you must do so in their native language. Your phone processor should be able to provide you with the tools to do this – if not, switch to one that can.

Also bear in mind in mind that many Russian surfers still have relatively slow dial up Internet connections, so you should therefore consider making material available to them that they can realistically enjoy, such as pics and smaller vid-clips, to avoid excessive download times.

Chances are, Russian surfers only have one phone line; so pay-per-minute phone billing will clearly not work since the surfer needs two lines to pay you this way — one to call the premium number, the other for connection to the web.

You should therefore employ password billing whereby the surfer "buys time" in advance using their land line or cell — when he enjoys your content, the billing clock is no longer ticking.

Since the payouts available with such billing are considerably less than the usual monthly subscription rates, simply give these users less time to enjoy access to your member's area.

If you are concerned that your content will then be made available on P2P networks and so forth, ask your phone processor to provide you with DRM protection to ensure that your content is only made available to those Russians that pay you for it.

Despite the challenges, our old enemy represents a fantastic opportunity for webmasters to make money from this huge, emerging market.

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