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Government finally kick-starts 3G rollout

12 Feb 2003

Estonia’s long wait for 3G is coming to an end with the news that parliament has approved the sale of three UMTS licences to the country’s existing mobile operators. Eesti Telekom, Tele2 and Radiolinja will pay EUR4.5 million each for the licences, considerably less than the EUR6.4 million suggested by the government in its initial proposals. A fourth licence will be sold in a second round auction to the highest bidder. The licensing procedure has been a protracted affair; in April 2001 the government proposed awarding four UMTS licences via a beauty contest scheduled to take place before the end of that year with services forecast to launch during 2003. However, amendments to the country’s telecoms laws and the limited success of 3G operations elsewhere in Europe have slowed progress.

Despite the delays, the incumbent operators have already begun to discuss the possibility of network sharing, with Tele2 campaigning for the construction of a single UMTS network, a seemingly practical solution in a country of just 1.4 million people. Its rivals have been less enthusiastic but neither has ruled out the possibility of collaboration, with a firm decision expected once the licences have been issued. The government hopes that this approach will enable operators to offer services at reasonable prices which, in turn, should encourage the diffusion of UMTS and continue the upward growth in the take up of cellular services in Estonia, which had 753,900 mobile customers at the end of September 2002, a penetration of 55.4%.

CIT's Datafile of Eastern European Telecommunications

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