MINSK, Belarus—Russian carrier Mobile TeleSystems (MTS) won the tender for the second GSM license in neighboring Belarus. Belarussian President Alexander Lukashenko, who personally followed tender developments, announced the news.
Lukashenko said MTS had agreed to double the price for the license to US$10 million and pay a US$2.5 million bonus to the Belarussian budget. MTS also accepted the tender condition to operate through a joint venture with the Belarussian state-run Mezhdugorodnaya Svyaz (Interurban Communications) company, which will have a 51-percent stake in the joint venture and thus allow the state to fix the tariffs.
MTS competed in the tender finals with St. Petersburg-based North-Western GSM, the Alfa-Eco Telecom investment company, which has a blocking stake in Vimpelcom (BeeLine), as well as with Austrian Dr. Karl J. Pisec Export-Import and the Saudi Oger.
Besides doubling the price for the license, MTS also proposed the highest investment of US$215 million into the network.
MTS must launch commercial operations in April 2002, when the exclusive GSM license with Mobile Cellular Communications (Velcom) expires. MTS will have to cover a territory with 70 percent of the 10 million Belarussian population.
Belarus currently has two carriers—Belcel (NMT-450) and Velcom (GSM) with 18,000 and 75,000 subscribers respectively. The Belarussian Communications Ministry predicted the number of subscribers to increase to 250,000 by 2005. However, Russian wireless market experts believe the growth could be twice as high.
