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ARMENTEL'S 3G LICENCE UPS ANTE IN ARMENIAN MOBILE MARKET
by Michael Lacquiere
Global Insight
October 9, 2007
Armenian mobile operator Armentel has been granted a 3G licence. The
licence allows the provision of 3G services in the 1920-1935 MHz
and 2110-2115 MHz frequency bands. Armentel's monopoly of the mobile
sector ended in 2005 with the launch of K-Telecom, which has since
become the country's market leader with 986,000 subscribers at the
end of the first half of 2007, compared to Armentel's 471,000. On
1 October 2007, Armentel also relinquished its monopoly of numerous
other areas of telephony, including the fixed-line, leased-line and
IP telephony markets (seeArmenia: 3 October 2007:).
Significance:Having seen first its monopoly and then its leadership
of the mobile market taken away by K-Telecom, Armentel will hope to
establish a decisive lead in an as-yet unexplored 3G market. Extra
spice in the contest between Armentel and K-Telecom is added by the
fact that Armentel was this year fully acquired by Russia's VimpelCom,
while K-Telecom was just last month acquired by VimpelCom's major
Russian rival, Mobile TeleSystems (MTS) (seeArmenia: 17 September
2007:). VimpelCom and MTS are currently racing to launch 3G services
in Russia and, with press reports suggesting that K-Telecom is likely
to obtain its own 3G licence in Armenia imminently, it appears that a
similar battle will now be waged by the Russians' Armenian units. At
the moment it is unclear when Armentel intends to launch 3G services,
or what sort of demand there will be among subscribers. At the start
of the year, mobile penetration in Armenia was just 14.5%, and the
percentage of high-end post-paid subscribers to Armentel's network
has traditionally been low--factors that suggest that 3G uptake will
not necessarily be strong. However, in the second quarter of 2007,
Armentel reported monthly ARPU of US$17.3, a high level that indicates
that it may be within the means of its current subscriber base to
embrace 3G services. Competition in the sector is likely to make 3G
services more affordable.
by Michael Lacquiere
Global Insight
October 9, 2007
Armenian mobile operator Armentel has been granted a 3G licence. The
licence allows the provision of 3G services in the 1920-1935 MHz
and 2110-2115 MHz frequency bands. Armentel's monopoly of the mobile
sector ended in 2005 with the launch of K-Telecom, which has since
become the country's market leader with 986,000 subscribers at the
end of the first half of 2007, compared to Armentel's 471,000. On
1 October 2007, Armentel also relinquished its monopoly of numerous
other areas of telephony, including the fixed-line, leased-line and
IP telephony markets (seeArmenia: 3 October 2007:).
Significance:Having seen first its monopoly and then its leadership
of the mobile market taken away by K-Telecom, Armentel will hope to
establish a decisive lead in an as-yet unexplored 3G market. Extra
spice in the contest between Armentel and K-Telecom is added by the
fact that Armentel was this year fully acquired by Russia's VimpelCom,
while K-Telecom was just last month acquired by VimpelCom's major
Russian rival, Mobile TeleSystems (MTS) (seeArmenia: 17 September
2007:). VimpelCom and MTS are currently racing to launch 3G services
in Russia and, with press reports suggesting that K-Telecom is likely
to obtain its own 3G licence in Armenia imminently, it appears that a
similar battle will now be waged by the Russians' Armenian units. At
the moment it is unclear when Armentel intends to launch 3G services,
or what sort of demand there will be among subscribers. At the start
of the year, mobile penetration in Armenia was just 14.5%, and the
percentage of high-end post-paid subscribers to Armentel's network
has traditionally been low--factors that suggest that 3G uptake will
not necessarily be strong. However, in the second quarter of 2007,
Armentel reported monthly ARPU of US$17.3, a high level that indicates
that it may be within the means of its current subscriber base to
embrace 3G services. Competition in the sector is likely to make 3G
services more affordable.