Telecommunications in Russia - Telephone

Telephone

Telephones – main lines in use: 25.019 million (1995)

Telephones – mobile cellular: 161,000,000 (2007)

The telephone systems in the 60 regional capitals have modern digital infrastructures; cellular services, both analog and digital, are available in many areas. In the rural areas, the telephone services are still outdated, inadequate, and low density.

The Tsarist government of Russia issued its first decree on the development of urban telephone networks in 1881 and, as already discussed, the first exchanges in the Empire opened the following year. Initially, telephone exchanges were granted to private developers as concessions in the major cities, but in 1884 the government began to construct the first of its own exchanges and subsequently suspended the award of new concessions. Intercity telephone communications grew very slowly, with only a dozen lines in place by the start of the 20th century, most serving Moscow-Saint Petersburg traffic. After 1900, when the initial concessions had expired, the government eased control over private concessionaires and a burst of new construction took place. Included in the expansion during this period was the slow growth of exchanges built and operated by rural Zemstva, which were treated essentially as private concessionaires by the Imperial government.

Telephones played a significant role during the upheavals of 1917. In February, according to the last tsarist Chief of Police, 'neither the military authorities nor the mutineers thought of occupying the Telephone Exchange'; consequently it continued to function, serving both sides, until the operators finally left their positions amidst the growing confusion. In early July, however, the Provisional Government, fearing a Bolshevik coup, reportedly ordered the central telephone exchange to boycott calls requested by Bolsheviks (automatic switching systems had not yet been introduced).

In 1918, when the Soviet government moved to Moscow and war conditions were producing extreme shortages, Sovnarkom ordered a reduction of 50% in the volume of telephone communications in the new capital, to ensure that official needs of the new government would be served. The primary consequence of this decree for individuals was the 'communalisation' of telephones in private houses and flats. According to the decree, restrictions were focused on the 'parasitic stratum' of society, in the interest of the 'working population'. With the exception of personal phones belonging to high government officials, doctors and midwives, telephones in private flats were placed at the disposal of 'house committees', to be made available for 'general use' free of charge. Houses without telephones were entitled to free use of the communal phone of a neighbouring house; the decree further ordered the immediate installation of at least 150 telephones in public squares, particularly in outlying regions.

One year later Sovnarkom nationalized all telephone systems in the Russian Republic-including all intercity, urban, concessionary and zemstvo exchangesand assigned their administration and operation to the People's Commissariat of Posts and Telegraphs. Beginning with the nationalization of telephones in 1919, Soviet policy exhibited two mnain characteristics: telephones increasingly became instruments for the bureaucracy and bureaucrats, and telephones in general were accorded a low investment priority. In March 1920, for instance, government institutions were exempted from the telephone tariff, receiving the right to use the telephone without payment, albeit for sharply restricted periods.

Until the end of 1991 (the end of the USSR), the sole fixed-line telephone operator in the country was the Ministry of Communications of the USSR. The state possessed all telecommunications structure and access networks. In 1994, the investment communication company (OJSC “Sviazinvest”) was established by the Presidential Decree #1989 dated 10 October 1994 “On the specific features of the state management of the electric communication network for public use in Russian Federation”. The authorised capital of OJSC “Sviazinvest” was formed by the consolidation of federal shares of joint stock companies acting in the area of electric communications and established during the privatisation of the state enterprises for electric communications. The seven regional incumbents which make up Svyazinvest, majority-owned by the government, in early 2011 merged with the key subsidiary Rostelecom. The move created an integrated company based on Rostelecom which will be better placed to exploit economies of scale in coming years.

Cross-country digital trunk lines run from Saint Petersburg to Vladivostok, and from Moscow to Novorossiysk.

Liberalization of the long distance communication market is another market driver. Rostelecom lost its monopoly when new players obtained licences for the provision of long-distance communication services. Currently, there are about 32 active companies in this space, including MTT, Golden Telecom, TransTeleCom and Synterra. Russian regulation stipulates that new players must build their own networks. The growth of traffic between Europe and Asia is an additional opportunity; more than 6,000 km of international communication cables were built during the first nine months of 2007, representing a 48.5% increase on 2006, according to the Russian Ministry of Communication and Mass Media.