The Russian Ministry of Communications and Mass Media has finally made a move on the deployment of LTE technology, a widely accepted pre-4G mobile network standard. A consortium composed of the so-called “big three” leading national mobile operators, MTS, VimpelCom and MegaFon, in cooperation with state fixed-telephony operator Rostelecom, has been requested to investigate all the conversion possibilities for frequencies currently used by the Defense ministry and other state bodies, the costs involved as well as the most expedient means of using these bands commercially. The investigations are expected to be completed by July 2011.
Last December at a meeting with the State Radio Frequency Commission (SRFC) the consortium was requested to determine the technical conditions under which LTE could be used within the existing networks. All possible bands are concerned: 700-862 МHz, 890-915 МHz, 935-960 МHz, 1710-1785 МHz, 1805-1880 МHz, 1920-1950 МHz, 2010-2015 МHz, 2110-2140 МHz and 2500-2700 МHz. The required bandwidth for commercial use LTE technology is at least of 10 to 20 MHz. These bands are currently used by the Russian Defense Ministry and other state radio-systems and would require conversion. The industry bloc is headed by former MegaFon top-manager Alexander Volkov.
After the feasibility study, the consortium will develop a proposal to free up these bands and define costs. According to the Russian Minister of Communications Igor Shchegolev, after agreement is reached on an optimal conversion scheme, the state regulator Roskomnadzor will establish tender parameters and the frequencies will be allocated by free open tender for all national carriers in July 2011. In the final phase of integration, the allotted frequencies will have to undergo conversion procedures, including the modernization of outdated military and other state owned equipment and the transfer of it to other bands. In some cases, this may prove prohibitively expensive, especially for small players. The conversion costs alone for the most attractive band, 700-862 МHz, could reach at as much as $2 bn.
A particular feature of the consortium is that it is theoretically opened to other Russian and foreign carriers. Swedish mobile discounter Tele2, for example, with almost half its total subscribers in Russia, has already expressed its intention to take part in consortium activity.
After approving LTE frequencies, a future tender will be open for westerns operators too, but with the strict condition that foreign players be excluded from participating in the modernization of Russian military equipment. This condition could be overcome, however, through the formation of joint-ventures with Russian national partners.
According to Naum Marder of the Russian Communications and Mass Media Ministry, the Russian government has approved a plan for deploying telecoms-related technologies in the coming years. This plan implies that the initial LTE rollout will be in the 2300-2400 MHz and 2500-2700 МHz range to 2015 with lower 700-862 МHz, 890-915 МHz and 935-960 МHz frequencies becoming available a year later. Also, according to this plan, the 2300-2400 MHz frequencies will be offered to a single, as yet unnamed, operator only. It is likely that the frequencies will go to state fixed-line operator Rostelecom, which already obtained these frequencies through a previous tender in March 2010. Frequencies in the other bands will be allocated between four carriers, MTS, VimpelCom and MegaFon as well as Tele2 Russia.
Update Feb 11, 2011
Although the first consortium meeting was due to take place today, Tele2, which had previously expressed desire to participate, was not notified of the meeting by the Russian authorities or Rostelecom, said the company.
Source: Vedomosti
Update Feb 24, 2011
Representatives of the mobile operators involved in the discussions with the State Committe for Radio Frequencies, speaking under conditions of anonymity to Vedomosti, reported that the creation of the consortium is being delayed and the July 1 deadline for completing the investigations on frequency conversion is unlikely to be met.
Consortium members are insisting on implementing conversion operations themselves after investigating the technical possibilities and costs for conversion as requested by the government. The operators are also expecting to receive government guarantees regarding the considerable investments required for these conversion operations.
Source: Vedomosti
