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Summa Group Plans 4G Bid

Summa Group co-founder Ziyavudin Magomedov Maxim Stulov

Business conglomerate Summa Group plans to take part in this summer's government tender for 4G licenses, according to company board chairman Vladimir Androsik.

A successful bid will give Summa frequencies that would allow it to provide next-generation mobile services. But with the tender conditions tilted toward the big three mobile operators and state-owned Rostelecom, it isn't clear whether Summa has a chance.

Winners of the long-term-evolution bandwidth, or LTE, must spend at least 15 billion rubles ($461 million) per year to ensure a nationwide build-out by 2019, Kommersant said Tuesday.

Summa has little chance of winning one of the four blocks of 4G frequencies, said Yuly Matevosov, a senior telecom analyst for Alfa Bank.

The "4G licenses and the tenders are not only about the money," he said. "It's a beauty contest."

Androsik told Kommersant that Summa Group has invested about $150 million in Summa Telecom since the division was created. But that was in 2005, according to its website.

He also said Summa needs 1.5 billion to 2 billion rubles to put its broadband Internet network in 15 more cities and attain 1 million to 2 million customers. Currently, Summa Telecom covers 11 cities and has 180,000 subscribers, its website says.

Contenders must meet a long list of requirements, and telecom observers expect that Mobile TeleSystems, MegaFon and VimpelCom's Beeline, as well as Rostelecom, will be the winners, given the scale of their operations.

The Communications and Press Ministry will award the frequencies July 12.

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