Russia Backtracks on 3G
September 26, 2004 - source: BWCS
The Russian government has postponed issuing 3G licences until at least the end of next year according to reports this morning from RosBusiness Consulting, the Russian online information agency. RBS claims that the Moscow administration had been expected to start handing out next generation mobile phone licences at the beginning of next year, however, the government now says it will continue to focus operators' efforts on improving the penetration of second generation mobile phone networks. According to the country's Communications Minister, Leonid Reyman, the capital enjoys a mobile penetration of 84.4% while this figure is markedly lower across most of the rest of the country, especially in rural areas.
Russian based market research company Lighthouse Business Management, points out that mobile usage in the former Communist state has grown enormously in the past five years. According to Lighthouse mobile phone penetration has soared from around 1% in 1999 to an estimated 46% for the end of 2004. Lighthouse, along with many other commentators on the Russian mobile market, believes that the main period for growth in second generation networks will occur over the next two years. It is largely this argument which seems to have persuaded Reyman and his colleagues to put the brakes on any 3G development. Lighthouse forecasts that mobile penetration in Russia will reach over 68% by 2006.
Meanwhile, a long-running row between the Kremlin and Russian mobile giant VimpelCom rumbles on. The operator stands accused of offering mobile services in Moscow without owning a valid licence. According to VimpelCom it holds a licence to operate in the Russian capital through its subsidiary company, KB Impuls. However, VimpelCom has been thrown into a dispute with the Ministry of Communications as it continues to offer services under its own name in the capital.
The government is also said to be investigating VimpelCom on charges that the mobile operator has been avoiding paying taxes by routing some of its international calls away from the networks of the state-owned fixed line monopoly telco Rostelecom. The investigation could lead to tax evasion charges.
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