By Atom Markarian
After ten days of deliberations and reportedly heated debates the government approved late Wednesday a compromise agreement to settle its long-standing disputes with ArmenTel which will lead to a partial liberalization of Armenia’s telecommunications market. Justice Minister David Harutiunian who negotiated the out-of-court settlement was given ten days to formalize it with the ArmenTel management.
The deal will end the Greek-owned operator’s monopoly on wireless services which is believed to have hampered the development of mobile telephony in the country. However, only one alternative mobile phone company will be allowed to operate until 2009.
ArmenTel, which is 90 percent owned by the Greek telecom giant OTE, also secured a string of other concessions from the government. The most important of them would maintain its legal monopoly on Armenia’s Internet access to the outside world for eight more years.
Furthermore, it will gain the exclusive right to Internet telephony widely used for making calls abroad. As many as 250 small Armenian firms have until now provided the service at prices much lower than the ArmenTel tariffs for regular international phone calls. Representatives of those companies have voiced strong protests against the planned measure that spells an end to their business.
In addition, ArmenTel will be allowed to raise its fixed-line phone charges which many Armenians feel are already disproportionately high. The telecom monopoly committed itself to restore phone connection in 800 remote villages in return.
Speaking after the late-night cabinet meeting, Harutiunian claimed that the settlement is the best possible deal Armenia could get from ArmenTel. Finance and Economy Minister Vartan Khachatrian also defended it.
But Khachatrian admitted that some cabinet members remain opposed to the deal. Transport and Communications Minister Andranik Manukian is believed to be its main government critic.
The government had earlier decided to unilaterally revoke the embattled operator’s monopoly on mobile phone services and external Internet traffic. The Greeks responded by filing a lawsuit with a London-based economic court before the two sides agreed to again try to reach a mutually acceptable settlement in June. Harutiunian has since negotiated with them on behalf of the government.