Russia’s proposed telecom licensing reform would leave 27 regions without local internet providers
A Digital Development Ministry initiative to tighten requirements for telecom operators would leave 27 regions without local internet providers, the Russian business news outlet RBC reported. Aleksei Leontyev, director of the Association of Telecommunications Operators (ASTO), cited the figure at a roundtable discussing proposed amendments to the legislation.
In April, the Digital Development Ministry planned to introduce three telecom licenses — basic, universal, and general — replacing the current 17. Depending on the license type, the cost would range from one million to 50 million rubles. The ministry also plans new requirements for companies’ minimum authorized capital and for how extensively their communications infrastructure must cover the regions.
About 4,700 operators currently work in Russia, not counting major federal companies and their subsidiaries. Only those with revenue exceeding 400 million rubles would be able to meet the new requirements, the outlet Frank Media reported.
Leontyev said these companies would be hit hardest: by his estimate, 21% of operators have revenue below 100 million rubles, and 36% have revenue below 200 million rubles. Regional operators, he said, together account for 45% of Russia’s broadband internet market.
Oleg Grishchenko, head of the Rosteleset association, said the reform would also hit the “new regions” — Russian-occupied territories of Ukraine, where mostly local providers operate — as well as small towns, where telecom service is usually built by local entrepreneurs with modest revenues.
Experts say the reform itself would require substantial spending to reconnect subscribers — spending that would have to come from the state budget, since Russia’s largest operators are all heavily in debt. Leontyev believes the cost could run into “hundreds of billions of rubles.”
The Digital Development Ministry believes the new measures will improve the quality and availability of communications services, leaving only “reliable” operators in the telecom market. The ministry stresses, however, that no final decisions have been made and that the initiative is still only being discussed with businesses.
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