Alisher Usmanov, the Russian billionaire and majority owner of MegaFon, the second largest mobile phone operator in Russia, is set to close a deal this week that will combine the telecoms assets of MegaFon with Scartel, the firm that runs Russia’s Yota-branded LTE network.
According to Russia’s Vedomosti business daily, the combined holding will give Usmanov access to more than 50 percent of Russia’s LTE spectrum ahead of upcoming fresh auctions.
Earlier reports suggest that the merger will see Usmanov own 80 percent in a holding company, which in turn would own 100 percent of Scartel and 50 percent plus one share of MegaFon.
Scartel’s Yota – a former WiMAX operator – was transformed last year into a joint venture between MegaFon, MTS, VimpelCom and Rostelecom to build a shared LTE network. But the project has run into various problems, and several of the operators involved are reportedly now looking at launching LTE outside of the Yota arrangement.
However, MegaFon proceeded to ink a deal with Yota in February 2012 to use the latter’s LTE spectrum, enabling it to become the first of the big three operators to launch commercial 4G services, reports Mobile Business Briefing. MegaFon subsequently switched on LTE networks in Moscow, Krasnodar and Novosibirsk and Sochi, the venue for the Winter Olympics in 2014. It plans to go live in at least four more cities by year-end.
Meanwhile, MegaFon was named as one of the eight operators this week given permission by Russian telecoms regulator Roskomnadzor to participate in Russia’s upcoming LTE auctions. The list also includes VimpelCom, MTS, Rostelecom, TTK, Summa Telecom, Tele2 Voronezh and Tele2 Omsk. Bidding starts on 12 July for the mobile phone industry in Russia.
The Russian Federation has 225.8 million mobile subscribers in total, or a 156% penetration rate (March 2012).
Russia’s three largest mobile operators all lost subscriber connections in Q1 2012, as the country’s mobile penetration rate topped 160 percent. Market-leader MTS was down 570,000, second-placed MegaFon was down 1,000, and third-placed VimpelCom was down 1.6 million. These three operators account for 83 percent of the Russian market, though smaller players continued to add subscribers, notably discount operator Tele2.
In other news, the Russian parliament on Wednesday voted to approve a contentious bill that activists fear will introduce Internet censorship by blacklisting sites deemed as undesirable. Deputies also passed in first reading a bill that makes libel and slander criminal offences with punishment of up to five years.
The two bills are criticised as likely to be used against the opposition and follow initiatives hiking protest fines and introducing the term “foreign agents” for NGOs with funding from abroad.
Related Dailywireless articles include; Yota Switches to LTE – Overnight , Joint LTE Network in UK Planned by Vodafone and Telefónica, Yota Plans Overnight Swap from WiMAX to LTE, Europe’s Digital Divide Auction, Yota Dumps WiMAX