Siemens will be supplying all of the Baltic countries with W-CDMA network technology: Following orders from mobile operator Tele2 in Estonia and Latvia last year, UAB Tele2 in Lithuania has now also contracted with the Siemens Communications Group to build a nationwide 3G network.

“We are pleased about this series of orders from Tele2. They confirm our quality and performance in building mobile infrastructures as well as our leading role in 3G technology,” said Christoph Caselitz, President of Mobile Networks at Siemens Communications. In addition to 3G radio technology, Siemens will be upgrading existing line- and packet-switched network elements in order to enable broadband data services, like music downloads to mobile handsets or video telephony, in Lithuania.

Independent industry analysts rank Siemens/NEC number one in the 3G/W-CDMA market with respect to commercially installed base stations – NodeBs (source: Multimedia Research Institute, Tokyo, April 2005). Approximately 40 operators in over 30 countries throughout the world are already utilizing 3G technology from Siemens.

Pan European alternative service provider Tele2 is today reported to be moving to acquire Russian operator SMARTS for as much as $700m (ВЈ385m).

Russian investment bank Aton Capital said that such a deal that would raise the Swedish company’s share of Russian subscribers from 3.2 per cent to 5.6 per cent and make it the fourth largest cellular operator after Mobile TeleSystems, VimpelCom and MegaFon.

Aton does not believe the deal will have a material impact on Russia’s mobile market as Tele2 will not have the economies of scale of the big three, while the mobile operations of regional telecoms will continue to benefit from fixed-to-mobile synergies.

Earlier this month Tele2 announced it has acquired the remaining 30 per cent of Russian regional operator Siberian Cellular Communications (SCC) it did not already own. Tele2 raised its stakes in five regional Russian operations in February, in a potential move to make the assets more attractive to potential suitors.

Swedish operator Tele2 today reported that net profit for the first quarter more than halved to SKr230m (ВЈ17m), down from SKr483m a year ago. Earnings before interest, tax, depreciation and amortisation (EBITDA) also dropped from SKr1.41bn to SKr1.37bn, although revenues increased from SKr11.57bn a year ago to SKr13.45bn.

Lars-Johan Jarnheimer, president and chief executive officer of Tele2 said that 2006, “is a year of transition. The balance we have maintained between growth, profitability and cash flow has temporarily shifted in favour of growth as we seize the opportunities available to us in broadband and mobile, in order to position the business for the longer term.”

The company’s number of mobile subscribers increased 43 per cent year on year to top 12.4 million during the first quarter, but the fixed telephony and internet subscriber base suffered as users migrated away. The fixed line base decreased 9 per cent year on year to just over 18 million.