OREANDA-NEWS. On 04 August 2009 COMSTAR – United TeleSystems (COMSTAR-UTS, LSE: CMST), the leading operator of integrated telecom services in Russia and the CIS, announced its business development plans for the Central Federal District (CFD).

CFD is one of the most developed regions in Russia, with more than a quarter of country population living here and a third of GDP produced. In 2008 COMSTAR-UTS acquired STREAM-TV as well as the following companies in Ryazan: Intersvyaz-Service and Inter-TV Media providing cable TV, Internet, and fixed voice services. Today, a total number of COMSTAR-UTS subscribers in CFD exceeds 400,000, with more than 370,000 cable TV subscribers, about 34,000 broadband Internet users, and around 18,000 voice communication subscribers. COMSTAR-UTS estimates its cable TV market share in the cities of its presence in CFD to make about 45%. In some cities COMSTAR-UTS leads the market. Namely, according to COMSTAR-UTS estimates, as of the end of 2008 the cable TV market share in Kaluga made around 97%, whereas in Ivanovo (including Shuya) it was about 90%, and in Kursk the market share made 77%.

According to the business development strategy of COMSTAR-UTS in CFD, it is planned to use a large subscriber base of cable TV to promote broadband Internet and voice communication services.

Under the business development program for CFD in 2008-2009 a selective network upgrade was carried out featuring implementation of FTTB technology (Fiber-To-The-Building), enabling an enhanced quality and substantially increased number of channels available to cable TV subscribers as well as providing broadband Internet. In Q209 the Company commercially launched broadband services in the following cities of CFD: Tver, Kaluga, and Tambov. At present, taking into account the growing demand, the Company is expanding the geography of subscriber connection in these cities, and taking some marketing actions to attract new customers. In 2010 the broadband Internet is planned to be launched in Smolensk.

Anatoly Kraynev, Deputy General Director, Center Macro Region Managing Director of STREAM-TV, notes: “The high-priority tasks for the Center Macro Region development for the nearest future are technological standardization and network upgrade, retaining our cable TV large market share in all cities of our presence, with an active development of new services, i.e. telephony and broadband Internet.”

Presently, COMSTAR-UTS provides telecom services in 10 cities of CFD, namely: Voronezh, Ivanovo, Shuya, Ryazan, Kaluga, Smolensk, Tver, Kursk, Orel, and Tambov, with a total number of inhabitants exceeding 4,000,000. As part of the regional business reorganization and creation of a single center to consolidate COMSTAR-UTS regional assets, a Central Macro Branch is being established with its management center in Moscow. As a result of reorganization, 9 cities of presence will have their Centers of Telecom Services based on the former branches, whereas in Shuya a telecom department will be created.

Viktor Koresh, Regional Development Vice President of COMSTAR-UTS and General Director of STREAM-TV, says: “We build the structure of our regional business on a macro regional basis as we need to enhance the management efficiency for the existing regional assets after the period of expansive development and active regional acquisitions accomplished by the Group. Establishment of six large macro branches will make this structure more transparent. In all macro regions uniform technological standards for development will be introduced with a uniform approach to customer care procedure. As a result, in each city of presence the Group will eventually provide Triple Play services, i.e. voice communications (local, zonal, and long-distance), broadband Internet, and Pay-TV.”