VimpelCom, an international NASDAQ-listed telecom group and a leading Russian mobile operator under the Beeline brand, is stepping up its Russian-wide LTE presence. Last Friday, the operator started an active regional 4G expansion by announcing the launch of a LTE network in Russia’s westernmost enclave of Kaliningrad. The FDD LTE standard network works in a 2,600MHz frequency range.
Earlier this week, the company launched a 4G network in the far-flung South Siberian region of Altai. As of Tuesday, 90% of the regional capital of Gorno-Altaysk was covered at the average data transfer speed of 10-20MBit/s.
By the end of 2013, the operator hopes to establish 4G communications in Kalmykia and Astrakhan in the Lower Volga area and in Ingushetia and Adygeya in the Northern Caucasus. By mid-2014, St. Petersburg and the surrounding region, as well as a few unspecified Russian cities with a population of more than a million each, will enjoy Beeline LTE capacities.
Plans also include a major upgrade of VimpelCom’s five-month-old Moscow LTE network. Now only available within the confines of the Sadovoye Koltso, the Garden Ring Road that encircles downtown Moscow, the 4G system is expected to cover 95% of the city by early December 2013. Next year, VimpelCom will launch a LTE network in the Moscow region, the Russian business daily Vedomosti reported.
By late 2014, VimpelCom expects an estimated 12,000 LTE base stations to be fully operational across the country.
VimpelCom is developing its plans based on how LTE-supporting smartphones currently sell. The market is bullish, according to a recent study by Svyaznoy, a major Russian mobile phone retailer. Approximately 1.2 million such smartphones were sold in Russia between January and September 2013, a 178-fold year-on-year upsurge.
VimpelCom is joining the other telecom majors in Russia’s 4G market. MegaFon first launched its network in Moscow in May 2012, followed by MTS in September 2012. Both immediately expanded beyond Moscow, with MTS LTE now present in four regions and MegaFon operating in 31 regions and counting. Rostelecom, the national telecom operator, started its first 4G network five months ago in Sochi, the Northern Caucasian city that will host the 2014 Winter Olympics and, by the end of next year, is expecting to cover a total of 12 regions.
Under the terms and conditions of the nationwide LTE FDD tender, each recipient of a license (MTS, VimpelCom, MegaFon and Rostelecom) is obligated to fully deploy their LTE networks within seven years, starting from January 1, 2013. Each recipient is committed to delivering LTE services to every Russian locality with over 50,000 inhabitants by 2019. Likewise, each operator is obligated to invest at least 15 billion rubles annually towards the LTE roll-out until the network is fully deployed.
However, the lack of available frequencies – a part of them being controlled by the military – and clarity in the regulator’s position in this field have made more difficult the development of LTE in the country.
J’son & Partners, a leading consultancy covering the Russian telecom market, expects there to be 15 million LTE subscriptions in the country by 2018.
