Russia's MTS Sees New Services Generating More Revenue In '05

MOSCOW -(Dow Jones)- Russia's largest cellular operator OAO Mobile TeleSystems (MBT) Wednesday said it expects value-added services to account for a larger percentage of average revenue per user, or ARPU, this year as it rolls out several new products.

Mobile TeleSystems, or MTS, expects these services to account for 12% of ARPU, Chief Executive Vasily Sidorov said at a press conference. That compares with 11% in 2004.

MTS plans to launch i-mode, a mobile Internet system that allows users to access a range of content and services including electronic mail, in September. Japan's NEC Corp. (6701.TO) will supply platforms and mobile handsets to support i-mode, according to an agreement signed Wednesday.

Other new services include improved roaming, news and entertainment information and provision of ringtones and pictures. In addition, mobile television will be available to subscribers with smart phones or pocket computers. The services are all scheduled for launch this year.

MTS also reiterated its intention to introduce the popular wireless platform BlackBerry to the Russian market. Company officials said they hoped to offer subscribers BlackBerry services in the fourth quarter of this year.

Russian wireless providers are racing to expand their array of services as competition has forced per-minute prices for phone calls down and shrunk margins.

Last month, OAO Vimpel Communications (VIP), Russia's second-largest mobile operator, launched a new value-added service called Chameleon, which uses Cell Broadcast technology developed by Celltick Technologies.

VimpelCom said it hopes the service will boost its ARPU by $0.50. Value-added services accounted for 16% of VimpelCom's revenue in the fourth quarter of 2004.

Company Web site: http://www.mts.ru

-By Andrew Langley, Dow Jones Newswires; +7 095 974 80 55; andrew.langley@dowjones.com

(END) Dow Jones Newswires"

Posted to the site on 11th May 2005