San Francisco-.Moscow Teleport, or SFMT, has sealed an agreement worth $100 million in debt and equity over three years to extend its services to the potentially lucrative Russian interior, according to Henry Radzikowski, head of the company's operations in the CIS and Eastern Europe.
Radzikowski said the company will spend $40 million on regional expansion and the remainder on Moscow services, including a $9-million local telephone exchange that is scheduled to come on line in August. "We now have an organizational structure in place and are taking a much more active role in our investments," he said.
Several other companies are planning big expansions in regional capacity in Russia. The best financed are BelCom and a collection of joint ventures led by Andrew Corporation.
"If SFMT get there first they will make a lot of money," said John Page, partner and telecommunications specialist Deloitte & Touche in Moscow. "Right now there is no one in Russia, certainly not the state network, that is able to offer real country-wide services."
The teleport, which began life in 1986 as a part-charitable electronic link between San Francisco and Moscow, now owns 50 percent of Sovintel, a joint venture with Rostelecom that operates a fiber-optic overlay network in central Moscow.
Sovam Teleport, a three-way joint venture with British firm Cable and Wireless and Russia's Institute of Automated Systems, has an electronic communications network across Russia and operates the Moscow SWIFT node for international interbank fund transfers.
According to Radzikowski, the company's drive into the regions will be led by Rusnet, a new joint venture between SFMT and its local and foreign partners that will act as a fulcrum for the whole network.
During 1994, the network will be extended to Tyumen, Krasnodar, Vladivostok, Novosibirsk and Ufa using a combination of five new regional satellite-earth stations and existing analog connections, he said. By 1996, SFMT hopes to reach about 150 locations by satellite and other means.
"We have decided to compete on quality," said Radzikowski. "Sovintel has the highest network quality in the capital and the concept behind Rusnet is to extend to the entire country the kind of voice and data services now enjoyed by people in Moscow."
In all, SFMT plans to offer Russian customers three integrated services: international access and private lines via Sovintel, electronic communications through Sovam Teleport, and intercity transmission and regional access through Rusnet.
"Money alone cannot assure the success of a venture like this," said Fred Andersen, vice president of DirectNet, a competitor of Sovintel. "Its success or failure will hinge on the personal strengths of Henry Radzikowski. I personally think he has most of the ingredients needed to pull this off."
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