Armenian government, telecoms operator negotiate in London

Armenian government, telecoms operator negotiate in London

Haykakan Zhamanak, Yerevan
17 Aug 04

Text of Vahagn Hovakimyan’s report in Armenian newspaper Haykakan
Zhamanak on 17 August headlined “They’re negotiating little by little”

Representatives of the Armenian government and the ArmenTel company
have been negotiating since 9 August in London. The Armenian
government is represented by Justice Minister David Arutyunyan,
ArmenTel by the company’s chief executive officer, Vasilios
Fetsis. The parties are refusing to make any comments on the
negotiation process. However, some information is provided by
unofficial conversations.

In particular, what is most important for the government is to take
back the monopoly given to ArmenTel in the sphere of cellular
communications, which can be considered already done. The developments
showed that ArmenTel does not want to struggle for a de jure monopoly
in the sphere of cellular communications any more, as it is able to
achieve its objectives without this juridical status. Thus, it is not
a surprise that the issue of losing the cellular communication
monopoly will be discussed during the negotiations only from the point
of view of possible ways of interrelations with a new operator.

In relations with ArmenTel, the second important task is bringing the
company back under control. That is, it is necessary for the company
to take no action without the government’s agreement, especially in
tariff policy. Our sources characterize the government’s goal in the
following way: ArmenTel must obey. All the remaining issues, such as
the digitization of stations, upgrading of Internet communication and
others can be considered secondary. For example, there is no doubt
that if ArmenTel does not increase the tariff per minute of fixed
communication, the government, in its turn, can forget about an
improvement in the quality of communications for some time. In the
given case the introduction of a tariff of eight drams per minute is
in question. It is a highly explosive issue for the Armenian
government. However, there is no doubt that in this issue the
government can only gain time at best. That is, in the course of the
negotiations, the government will have to come to an agreement on
tariffs, which means that subscribers will be informed in the near
future when these tariffs, a cause of general horror, will be applied.

According to specialists, the government may only gain time up to the
beginning of next year at best. Our sources close to the government
characterize the negotiations as a “war”, i.e. if the parties have
started negotiations, it does not mean that they are going to yield
their positions, and the past week of the negotiations is evidence of
it. At the same time, it should be noted that in this period, the
negotiations have been slower and the reason is the Olympics in
Athens. However, on the other hand, it is connected with other
circumstances as well. In particular, ArmenTel wants to deprive the
government of its trump card related to cellular communications, that
is, to overcome the deficit in the sphere. Thus, it is not accidental
that ArmenTel restarted the system of prepayment for cellular
communications, the provision of Easy Cards, yesterday in
Yerevan. Thirteen service points will distribute 200 numbers daily.
Easy Cards are provided to those registered during previous
months. However, ArmenTel does not specify what it will do next after
provision of the numbers. According to unofficial data, ArmenTel
intends to make uninterrupted provision of the cards, thereby
liquidating their deficit on the market.