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Mon, 10.02.2003
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600 companies apply for telecom licence in Romania
Mixed opinions on voice market deregulation

Bucharest (pte056/10.02.2003/21:08) - Effective as of January 2003, voice market deregulation in Romania has produced optimism from the authorities and skepticism from market analysts. Commenting on the initial results of the deregulation, Communications and IT Minister Dan Nica said, "The fact that almost 600 companies have already submitted notifications with the National Authority for Communications- ANRC for becoming voice operators makes us very optimistic about the future of Romanian telecommunications."

Still, despite the high number of notifications, analysts remain pessimistic when it comes to immediate future. "True enough, there were almost 600 companies submitting notifications to become operators," said Varujan Pambuccian, head of the IT Commission of the Parliament, "but I don't see any more than ten real players acting in this market in the near future."

Among the ten players Pambuccian mentioned are incumbent operator Romtelecom, GSM operators Orange and MobiFon, CDMA-2000 operator Zapp, several ISPs and a couple of potential operators that are the communications arms of public utilities like the national railways.

Most experts share his opinion, and they see the local loop as the main obstacle for the future public operators. Currently, Romtelecom owns the local loop, and investments to create parallel infrastructures are thought impossible under such circumstances.

Long distance and international calls are then seen as the only fields where there can be real competition in the voice market for the foreseeable future. Indeed, several companies have already launched international calling services - mainly based on pre-paid cards, with prices as low as 60 per cent of Romtelecom's prices.

In the medium term, though, the situation may change dramatically. One of the alternative telecom operators, RDS, an ISP and CATV company, recently announced it would launch pilot projects for generating local loop in urban areas.

"There are cities like Oradea and Brasov, where we have a market share of more than 90 per cent," said Radu Jugaru, CEO of RDS. "By using cable internet, we think we will be able to create local loops within such communities, thus generating real competition to Romtelecom."

The move followed a similar action by Atlas Telecom Romania, which, a couple of days ago, announced it would build fixed-line infrastructure in 20 Romanian local communities, providing them local loop as an alternative to Romtelecom.

According to Adrian Boca, CEO of the company, local loop services are to be provided by using radio infrastructure, while calls between the cities will be achieved via third party carrier services.

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