Operators will be able to get frequencies for 5G without bidding if the state gets a share in the joint venture (JV) that will clean them up. This follows from the draft concept for the creation and development of fifth-generation networks in Russia prepared by the Ministry of Communications (Vedomosti got acquainted with it, its authenticity was confirmed by a person familiar with the managers of several operators, and an employee of one of them). This is done to reduce operator operating costs and stimulate investment activity, the document says.
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In December 2019, MTS, Megafon, Vimpelcom and Rostelecom signed an agreement of intent to create a joint venture to jointly release frequencies for 5G. It was assumed that the joint venture will clean up the frequency spectrum in the ranges of 700 MHz, 3.4–3.8 GHz, 4.4–4.99 GHz and 24.25–29.5 GHz in all regions of Russia. The draft concept assigns this function to the joint venture. According to the intention of its authors, the SCRF (State Commission for Radio Frequencies) will either allocate all 5G frequencies for joint use by all the founders of the enterprise, or distribute shares in the 5G range between them.
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Vedomosti sent a request to the Ministry of Communications. Representatives of the surveyed Big Four operators note that this draft concept has not yet been approved and it is premature to draw any conclusions.
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The fact that the state intends to control the activities of the joint venture deputy minister of digital development, communications and mass communications Oleg Ivanov said in December last year. In particular, he proposed to transfer to the state the “golden share” of the joint venture. Later, Ivanov did not rule out that the State Committee for Emergencies could transfer part of its regulatory powers to the enterprise.
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Before creating a joint venture, it is necessary to finally determine what frequencies 5G will operate at, said Denis Kuskov, Telecom Daily agency general director. Without this, the tasks of the enterprise are not clear, he notes.
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Given the fact that over the past six months, the development strategy of 5G networks has repeatedly changed, the role and functions of the state in the joint venture is still difficult to determine, agrees managing partner of AC & M-Consulting Mikhail Alexey. Now the state has no other options to ensure the development of 5G except to resolve the issue of allocating frequencies of 3.4-3.8 GHz, he adds.
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The development of 5G networks in cities with a population of over one million may require total investments of 161 billion rubles from mobile Big Four operators, the draft concept says. The cost will be affected, in particular, by what frequencies will be allocated to the signalmen. If for the 3.4-3.8 GHz band the network equipment is already being produced by several large vendors, then for the 4.4-4.99 GHz band, which Russian officials see as an alternative to it, the supply of network equipment is much lower, market participants told Vedomosti earlier . But there are no smartphones at all.
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So far, the 3.4-3.8 GHz band, for which the popular 5G equipment is intended, is used in Russia by the Ministry of Defense and Roscosmos. In August 2019, the Security Council spoke out against allocating frequencies of this range to telecom operators, and President Vladimir Putin agreed with his opinion, Vedomosti sources in the television industry and relevant departments reported.
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