Chinese producer of telecommunications equipment Huawei Technologies has announced that it is about to sign a deal to supply 3G mobile technology to Ukrtelecom, which currently only offers fixed-line telephone and data communication services.
If signed, the agreement would make Huawei the second foreign firm to get a contract to help the state telecom company set up a 3G mobile network.
In October, Ukrtelecom inked a three-year deal with Finnish Nokia to supply 3G telecommunications equipment for Kyiv and Kyiv Region. Huawei hopes to facilitate the development of a network in Odessa and southern Ukraine.
Wang Chunsheng, director of Huawei Technologies’ recently opened representative office in Kyiv, announced Dec 13 that a contract with Ukrtelecom would be signed before the end of this year.
According to Ukrtelecom’s press-service, the company plans to start providing mobile communications services in March 2007 on the basis of its wholly owned long-distance subsidiary, Utel, servicing its corporate clients.
Third-generation technology allows faster and higher quality communications, including voice and high resolution video feed.
Industry insiders have said that building a 3G network in Ukraine from scratch could cost over $1 billion.
Ukrtelecom has announced plans to invest around $700 million into the 3G network by 2010. The company acknowledged to the Post that a deal with Huawei is in the works, but it has not disclosed any details.
Ukrtelecom has been equally taciturn about its arrangements with Nokia. It’s not clear, for example, whether other telecom equipment makers will also be invited to help the state-owned company set up a 3G mobile communications network.
Ukrtelecom first announced that it would hold its tender in search of support in setting up its 3G system at the beginning of this year.
Five global telecom equipment providers took part, including France’s Alcatel, Sweden’s Ericsson, Germany’s Siemens, China’s Huawei and Finland’s Nokia.
Ericsson was chosen earlier this year to provide Ukrtelecom with equipment and services for testing 3G technology free of charge, but it has yet to announce a paying contract.
Ukrtelecom is currently the only Ukrainian telecommunications company with a 15-year license to provide 3G-based mobile communications in Ukraine. The license was issued by the country’s Telecommunications Commission in December 2005.
Industry insiders and the country’s mobile services providers cried foul, accusing the state of trying to beef up Ukrtelecom’s value ahead of it’s much anticipated privatization, which has been postponed for years.
On the Dec. 6, parliament included Ukrtelecom on its privatization list for next year. The state fixed-line monopoly is 92.86 percent owned by the state.
Source: Kyiv Post