Ukraine awards 3G licence to Ukrtelekom

December 4, 2005

Ukraine has awarded fixed-line telecomms provider Ukrtelekom a licence for 3G mobile communications. The government plans to sell the state-controlled national fixed-line monopoly in 2006 and the 3G mobile license should improve Ukrtelekom's attractiveness to investors. The government has been planning to sell Ukrtelekom for at least seven years but officials see fixed-line telephony as less profitable than mobile services and feared the company would be sold too cheaply.

"In the coming three months, Ukrtelekom will restructure its management team, amend its business plan and launch tenders for providers of technical decisions. In October-November 2006 the company plans to start providing mobile services," the company said in a statement.

Ukrainian Mobile Communications (UMC), Ukraine's largest mobile operator, expressed concern over Ukrtelekom's 3G license. The government awarded the 3G licence to Ukrtelekom without holding a tender but simply ordered the defence and transport ministry to free up the necessary frequencies.

UMC, who also applied for a 3G license, demanded an equal playing field for all mobile market participants.

"...we think a major factor for our country's efficient economic development is to have clear and equal game rules for all participants and as well as full respect for the law," the company said in a statement.

UMC confirmed they intent to contact the President "with a request to help award UMC the 3G licence on conditions equal with Ukrtelekom."