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Cellular Majors to Launch 3G Services
Encouraged by the Monday decision of authorities to allocate G3 frequencies, the cellular giants of Russia announced their readiness to construct the flagship 3G networks here. The analysts say introducing the 3G in Russia will take time and cost money. Each operator will have to spend between $6 billion and $10 billion to establish new facilities, which construction will linger for many years.
The State Commission on Radio Frequencies resolved Monday to allocate the 3G frequencies to cellular operators. The frequencies could be distributed among operators via respective tenders already this year. Asked to comment on this decision, Russia’s cellular giants – MTS, VimpelCom and MegaFon – confirmed their interest towards 3G license.
“MTS cannot afford to avoid constructing the third generation network. We cannot help but do it,” MTS President Leonid Melamed said, adding the company will probably need around half a year to develop the 3G network once it gets the license.
VimpelCom is not so optimistic. “We cannot speak about investing in 3G, more so elaborate some business plan till we learn the terms of 3G provision. The terms and dates of submitting the bids will be known to us during 45 days,” said Yekaterina Osadchaya from VimpelCom.
Constructing the 3G nets in Russia will take time and money. Each operator will have to invest from $6 billion to $10 billion to construct the networks and to transfer the better part of subscribers’ base to it, said MDM Bank analyst Yelena Bazhenova. As to the time of construction, it could be from two to three years, Bazhenova said.
In view of subscribers’ base, the costs of two leaders could be roughly $8 billion (VimpelCom) and $10 billion (MTS), according to Bazhenova. The 3G introduction won’t be large-scale in the first year. More likely than not, the operators will construct networks in Moscow and St. Petersburg, spending around $150 million to cover 1 million users.
www.kommersant.com
All the Article in Russian as of Oct. 25, 2006
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