Russia’s MegaFon and Rostelecom team up on 5G

• Telcos see big cost reductions by deploying 5G on one infrastructure
• Are looking into the possibilities with a working group
• Want to roll out in 3.4-3.6 GHz and 26GHz

As some European telcos express themselves unconvinced about the near term economic case for deploying 5G services, the Russians are looking at a typically pragmatic business solution to at least defray the costs of covering their vast territory, even if they can’t be sure about the 5G top line.

The two big Russian telcos, MegaFon and Rostelecom, say they’re considering the  possibility of setting up a joint venture that would act as a single infrastructure operator for the construction of 5G networks in Russia. By jointly developing their 5G networks they reckon they should be able to reduce the costs for each player and  make more efficient use of backhaul, a cost item very much to the fore with fifth generation cellular because of the huge increases in data it will usher in.

Various forms of network sharing are already a feature of many countries’ competitive mobile arrangements and judging by some of the mood music now being played in other parts of Europe by telco leaders, it may also play a role in 5G deployment if telcos’ competitive instincts are overcome by fiscal caution.  At the moment their main concern is to work on maximising the opportunity for 5G by urging regulatory change, particularly around network neutrality.

MegaFon and Rostelecom say they plan to set up a working group to propose options for rolling out 5G networks in the 3.4 - 3.6 GHz and 26 GHz frequency bands, with special attention paid to identifying and freeing up relevant available space in the spectrum for 5G.

“In the current market conditions, the most logical and cost efficient option for deployment of the new standard is cooperation between several players. We are already working together successfully with Rostelecom as part of the working group on Information Infrastructure under the government program for Digital Economy and we see huge potential for further cooperation. I am confident that, through joint efforts, 5G can become the foundation for technological development in a number of sectors of the digital economy,” said MegaFon CEO Sergey Soldatenkov.

“We believe that the creation of a fully-fledged 5G mobile network in Russia will require market players to join efforts. Our partnership with MegaFon is designed to demonstrate the success of such an approach,” according to Rostelecom President Mikhail Oseevskiy.