ARMENTEL SEES BROADBAND NETWORK CONSTRUCTION IN ARMENIA COSTING "SEVERAL HUNDRED MILLION DOLLARS"
Michael Lacquiere

World Markets Research Centre
Global Insight
April 28 2010

Armenian fixed-line operator Armentel has indicated that the
construction from start to finish of a broadband network would require
"several hundred million dollars" of investment, reports ARKA,
citing Boris Nemsic, Chief Executive Officer of Armentel parent
group VimpelCom, inKommersant. A US$30-million project is being
planned for internet development in Armenia, with US$24 million
to come from a World Bank loan and the remainder from government
financing. However, the country’s Economy Ministry has suggested that
the boost to the economy of an electronic society facility by the
widespread introduction of broadband could amount to 97 billion drams
(US$249.5 million).

Significance:Armentel reported 26,200 broadband subscribers at the end
of 2009, representing an almost three-fold increase on the previous
year. This compared favourably with the national average for broadband
subscriber growth in 2009 of 57%, resulting in a nationwide total of
27,400 subscribers and a national penetration level of 0.9%. There
is therefore plenty of scope for further growth, and Armentel, with
the backing of Commonwealth of Independent States giant VimpelCom
and with legacy fixed-line infrastructure in place, is likely to be
at the forefront of what IHS Global Insight expects to be medium-
to long-term growth in the Armenian broadband sector. Armentel’s
capital expenditure in Armenia in 2009 was US$7.8 million, although
much of this would have been directed towards mobile operations.

From: Emil Lazarian | Ararat NewsPress