Rostelecom and Beltelecom Construct Fibre-Optic Communications Line

Russia's fixed-line, long-distance incumbent Rostelecom and Belarusian fixed-line monopolist Beltelcom have agreed a deal for the construction of a fibre-optic communications line, reports Novecon. When the project is completed the line will have a capacity of 400 Gbps. Fibre-optic cables have already been laid on the border between the two countries.

Significance: Since the liberalisation of Russia's long-distance fixed-line market at the start of the year, changes have been made to the way that operational and market performance figures are calculated. International long-distance (ILD) and domestic long-distance (DLD) services have become the exclusive preserve of long-distance operators, at the expense of regional operators. Consequently, Rostelecom recorded 565 million minutes of international calls in the first six months of 2006, compared to 276 million minutes in the whole of 2005. However, the new legislation in Russia's fixed-line market has also incurred a number of new costs for long-distance operators. These include payments to third parties for billing services and access to subscribers, as well as compensation to regional operators for revenue lost from DLD and ILD Traffic. Rostelecom will therefore be keen to maximise its strength in the international market, and the new fibre-optic line will be its second broadband channel with Belarus.