RIGA - The 2005 draft budget submitted to Parliament last week has earmarked 1.3 million lats (1.9 million euros) in revenues from the sale of the country's third UMTS license, though the Transport Ministry admitted that it was unaware of plans for the sale.
Prime Minister Indulis Emsis said that although an auction for the third UMTS license would be held, the government had not yet agreed on when.
The main purpose of selling a third license was not to raise money for the budget but to increase competition in Latvia's telecommunications industry, he said. "We want greater competition in telecommunications. If the competition grew tougher, tariffs would go down," Emsis added.
Transport Ministry officials, however, were at a loss to give concrete details about the UMTS license auction. "If the license is to be auctioned, it will be done by the regulator," Transport Ministry State Secretary Vigo Legzdins said.
But a public utilities regulatory commission spokeswoman said that the regulator had not planned any such revenues from the sale of the UMTS license in the 2005 budget.
Still, the Transport Ministry is carrying out a preliminary study to find out if there are companies interested in acquiring the UMTS license and if the auction should even be organized. An attempt to find a third operator failed several years ago.
Existing Latvian mobile telephone operators LMT and Tele2 each acquired UMTS licenses for 5.8 million lats. Under licensing terms, the companies must start commercial service in the UMTS network no later than Dec. 31 this year.
Meanwhile, it was reported that Telekom Baltija plans to provide mobile telecommunication services under the brand name, Triatel, as of Oct. 15.
Company spokesman Kaspars Licitis said that the company still had to complete testing an interconnection with Latvijas Mobilais Telefons and Tele2.
Telekom Baltija must also receive permission by Oct. 15 from the Electronic Communications Directorate for commercially providing mobile services.
Provided that the above three conditions are met, Triatel clients will be able to call customers of Latvia's three largest communication operators - fixed line operator Lattelekom, LMT and Tele2.
The company will provide mobile telecommunications in CDMA standard. Telekom Baltija said it expected some 40,000 clients to use its services as soon as the end of this year.
While introducing the latest CDMA technologies in Latvia, Telekom Baltija closed a contract with Nortel Networks, a U.S. and Canadian joint venture, on the construction of a CDMA network - a project expected to earn 20 million euros of investment by the end of 2005.
The CDMA network already covers Riga, its surrounding districts and Jurmala. The entire territory of Latvia could be covered in two or three years.
CDMA technologies will allow offering the public virtually all the same services as UMTS.
