NEW OWNER OF ARMENTEL INTENDS TO INCREASE ITS REVENUES THROUGH INTRODUCTION OF NEW SERVICES

Noyan Tapan
Dec 06 2006

YEREVAN, DECEMBER 6, NOYAN TAPAN. The acquisition of 90% of ArmeTel
shares is the greatest deal of the Russian company Vympelkom, and
ArmenTel is the largest enterprise (in terms of the number of its
subscribers) belonging to the company. Vladimir Ryabko, Vymplekom’s
Vice Chairman for Corporate Development, stated this at the December
6 press conference. He added that the company is not against acquiring
10% of ArmenTel shares belonging to the government but it has not yet
made a final decision on this issue. According to V. Ryabko, the mobile
phone communication operators of the Vympelkom group provide services
in Russia, Kazakhstan, Ukraine, Tajikistan, Uzbekistan, Georgia and
Armenia. All these enterprises show high profit growth rates thanks to
provision of extra services rather than a growth of tariffs. V. Ryabko
said that ArmenTel will also adopt this approach. It was mentioned
that today the Armenian mobile phone communication market is occupied
by 25-30%, and there is much potential for its development. In the
words of V. Ryabko, the total number of mobile phone communication
subscribers makes one million, 400 thousand of whom are ArmenTel’s
subscribers, and 600 thousand – VivaCell’s subscribers.

Vymplekom is going to improve the mobile phone network’s coverage
and the quality of communication, as well as to introduce a number
of new services, particularly mobile television. V. Ryabko said that
Vymplekom has no intention to give up the provision of fixed-line phone
services. At the same time, the company is prepared to relinquish
gradually its monopoly, in particular, on Internet connection
services. According to Oleg Bliznyuk, Vymplekom’s Director General,
prior to the acquisition of ArmenTel, Vympelkom had not provided
fixed-line phone services. Despite this fact, he expressed a hope
that there will be development in this sector too. In particular,
it is envisaged to improve the quality of fixed-line phone services,
increase the user density (which curretly makes 20% or 600 thousand
subscribers) and digitalization rate (currently 50%). ArmenTel’s new
owner also intends to introduce a billing system for users of mobile
and fixed-line phone communication.