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An overview of the telecommunications sector in Russia: Its main actors and competition

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In the undivided Soviet Union, the communication sector was under the jurisdiction of the state. The network of 40 million telephone lines, catered to 32 million subscribers, who lived in urban areas. Thus, the telephone network of the Soviet Union was one of the most congested networks in the world.

After the fall of the USSR, a major reform was initiated in the communication sector by the Yeltsin government in 1992. One of its components was the privatization of public enterprises in this field by their reorganization into joint stock companies. The principles of this reform were outlined in the Government Act of July 25, 1992, ? 526 "program of privatization and restructuring of public enterprises in SA in the communications sector" and the "Concept of the Program of the Russian Federation" 25 March 1993. Thus, the telecommunications market in Russia was officially declared open.

This regulatory regime also increased competition and led to the emergence of many new businesses in this area. Initially, 127 public companies were created. Since 1992, 7400 licenses were allocated for this sector. This market is represented by 2 traditional operators and nearly 4500 new operators.

This new legislation has also resulted in changes in the functions of different agencies controlling the telecommunications sector. Thus, the role of the Ministry of Informatics and Communications in this sector is reduced to function of regulating the telecommunications market. Its primary mission is to create favorable conditions for fair competition in the market.

The reforms of 1992-1998 had a positive impact on the development of this sector, by making it more efficient and profitable. It recorded consistent growth in revenue - between 20 and 30% each year - for operators and equipment manufacturers.

Thus, telecommunications is one of the areas of Russia which has demonstrated the strongest growth and the maximum contribution to gross national product (5%). The signing of the Charter of the Global Information Society by the President of Russia and representatives of industrialized countries in Okinawa in 2000 marked the beginning of a new era in telecommunications.

Tags: telecommunications; Soviet Union; telecommunications in Russia

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