Russian operators Beeline, Megafon and MTS have all expressed opposition to the creation of a 5G consortium even though it would in theory save them money.
The idea behind the consortium is for Russian operators to use locally built infrastructure and equipment to drive down their deployment costs. Last year, the deputy head of the Department of Information Technologies of Moscow Alexander Gorbatko said: “creating communication networks on the basis of a single infrastructure operator will allow all market players to reduce costs.”
Rostelecom and Tele2 are behind the plan, but it is opposed by the antitrust watchdog FAS and the country’s Ministry of Digital Development, Communications and Mass Media – and now, three major players have also voiced their objection.
Although the operators have not stated explicitly why they oppose the consortium, it is likely that such a cooperative exercise would reduce competition in the market. Indeed, Gorbatko noted in 2018 that “the unified platform carries the risks of lack of competition and, as a result, high prices for residents and consumers, lack of operator flexibility and monotonous services”.
Megafon’s objection is particularly surprising give that it has already created a 5G-focused joint venture with Rostelecom, and its name was mentioned as a possible participant in the proposed consortium.
However, the decision does not rest with the operators. Oleg Ivanov, deputy minister in the country’s communications ministry, said that the government would decide on how to progress over the next few months, noting that a consortium would reduce deployment costs.
Ivanov added that the government had allocated spectrum for conducting 5G trials, with a pilot scheduled to launch by the end of 2019. The technology is expected to become commercially available by 2021.