Leading mobile phone operators hit Tele2 with roaming

The Baltic Sea Alliance formed last week by leading Lithuanian, Latvian and Estonian mobile phone operators has resulted in the lifting of charges which were payable when receiving calls in a Baltic state other than the one where the customer held an account.

The free roaming service is available as of Dec. 6 to customers of Lithuania's Omnitel, Latvia's LMT and Estonia's EMT when they use the networks of the partners of their own service provider.

Customers will also not be charged double when calling a Baltic state other than the one where they are registered from outside the Baltic states.

Until the new agreement was established people quite often rejected incoming international calls while abroad.

Latvian Telecommunications Association Executive Director Janis Lelis said Sweden's Tele2 would lose the advantage of being the only mobile telephone operator with services which cooperate in all three Baltic states.

Tele2 Latvia has responded to the latest challenge by not charging its customers for calls they receive in Estonia as of Dec. 6.

"This is a continuation of our price leader strategy and a part of the most advantageous and broadest Tele2 network services in the entire Baltics," Tele2 Director Bill Battler said.

But Inga Jagomae, chief spokesperson for Tele2 Eesti, told BNS Tele2 had no intention of widening such a system across all its Baltic operations. Free incoming calls for clients of Tele2 Latvia are the result of a particularly tense competition in the Latvian market, she said.

Dainius Pupkevicius, vice-president of Lithuania's Omnitel, said that around 11 percent of the company's subscribers used roaming services, of which some 20 percent were used in Latvia and Estonia.

Omnitel's representatives gave no details as to what other new services the alliance plans to offer to its customers, but they did not rule out lowering rates for international calls between the networks of the BSA partner companies in the future.

LMT Vice-President Andris Portmanis said the newly-established alliance sought to offer clients greater convenience, lower costs and a broader range of services.

The Baltic mobile phone operators have been busy shaping the alliance, modeled on the Star Alliance formed by SAS, Lufthansa, Air Canada and other airlines, for a year or so under an agreement officially entitled The Baltic Partnership for Better Communication.

Companies that are members of the alliance remain fully independent and continue doing business in their respective markets, but together offer clients new and more advantageous services.

The price of calls made from a partner operator's network will remain unchanged, EMT said.

Johny Svedberg, Tele2 vice-president, said the new alliance could not match Tele2's presence in 21 countries.

The total number of clients of the new alliance is some 1.3 million, including over 335,000 LMT clients or more than 14.2 percent of Latvia's population, 376,000 EMT clients or 26.9 percent of Estonia's population and more than 500,000 Omnitel clients or 14.3 percent of Lithuania's population.

Tele2 has not made public the size of its customer base, but the figure is thought to be around 100,000 in Lithuania and just over 200,000 in all three Baltic states.

Finland's Sonera and Swedish Telia are the driving force behind the new alliance since together they own holdings in each of its three companies.

Omnitel is 55 percent owned by Amber Mobile Teleholding AB, a subsidiary of Sonera and Telia. U.S. concern Motorola Inc. owns a 35 percent stake and private investors have 10 percent in Omnitel.

Sonera and Telia each hold 24.5 percent of LMT, while 23 percent belongs to fixed-line monopoly Lattelekom. Sonera controls Tilts Communications, owner of 49 percent of the shares in Lattelekom. Also, state-controlled Digitalais Latvijas Radio un Televizijas Centrs owns a 23 percent stake of LMT, while the government still holds 5 percent.

Sonera and Telia each own 24.5 percent of Eesti Telekom, a holding company whose subsidiaries are fixed-line operator Eesti Telefon and EMT. The state of Estonia holds 27.28 percent of shares and private investors control the remaining 23.72 percent.

The total staff of the three BSA members exceeds 1,300 with LMT employing over 500 people, EMT some 300 and Omnitel about 500.