By Atom MarkarianThe abolition of ArmenTel’s controversial monopoly on wireless services has resulted in a dramatic spread of mobile telephony in Armenia, the chief executive of the Greek-owned national telecommunications operator admitted on Tuesday.
Vasilios Fetsis said the number of mobile phone users has more than tripled to about 650,000 in the past two years.
The bulk of the growth, touted as “fantastic” by Fetsis, has occurred since the launch of Armenia’s second mobile phone network last July as part of the sector’s partial liberalization which was initiated by the government in 2004. The move was the result of ArmenTel’s gross failure to meet domestic demand in the service.
Competition with the Lebanese-owned VivaCell operator forced the company to promptly make substantial investments in its wireless network and end a notorious rationing of prepaid SIM cards. It also led to a drastic drop in ArmenTel’s prohibitive tariffs, making the service far more affordable for ordinary Armenians.
“The quality of mobile phone service in Armenia meets European standards today,” Fetsis said. “I believe that both operators will cover the whole of the country by the end of this year.”
Speaking at a roundtable discussion in Yerevan, Fetsis disagreed with World Bank experts’ conclusion that ArmenTel’s continuing grip on other forms of telecommunication is seriously hampering the sector’s development. He claimed that his company has invested $300 million in Armenia’s telephone network since its 1998 takeover by Greece’s OTE giant. ArmenTel also plans to borrow 24 million euros ($29 million) from the European Bank for Reconstruction and Development to make further capital investments, he added.
Particularly controversial is ArmenTel’s exclusive right to Armenia’s Internet connection with the outside world. Local Internet service providers have long complained about its high cost and poor quality.