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Russian telecom users expected to see slower data, more dropped calls, longer outages: sources

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This content was produced in Russia, where the law restricts coverage of Russian military operations in Ukraine

By Supantha Mukherjee and Alexander Marrow

STOCKHOLM/MOSCOW, Dec 21 (Reuters) – When telecom equipment makers Nokia and Ericsson pull out of Russia at the end of the year, their departure could permanently disrupt the country’s mobile networks in the long term, causing connectivity problems for everyday Russians. .

Five senior telecom executives and other industry sources said Russian cellphone users are likely to experience slower downloads and uploads, more dropped calls, calls that don’t connect and longer outages as carriers lose time to update or patch software. ability and will fight the decline. stock of spare parts.

Ericsson and Nokia, which together account for the largest share of the telecommunications equipment market and about 50% in terms of base stations in Russia, make everything from telecommunications antennas to equipment that connects optical fibers that carry digital signals.

They also provide critical software that enables different parts of the network to work together.

“We are working until the end of the year, and that’s when all exemptions (from sanctions) expire,” Ericsson’s finance chief Carl Melander told Reuters. Ericsson has received sanctions relief from Swedish authorities.

Pekka Lundmark, CEO of Nokia, responded to that opinion in one of the interviews. “Our exit will be complete.

Russia’s economy has so far weathered government-imposed sanctions and export controls that have seen Moscow send tens of thousands of troops to Ukraine, but the impending withdrawal of Nokia and Ericsson could have a deeper impact on daily Russian life, eventually making things more difficult. , since. as simple as a phone call.

Russia’s digital ministry did not respond to requests for comment, but Communications and Mass Media Minister Maksut Shadayev said this week that four telecom operators were signing contracts to spend more than 100 billion rubles ($1.45 billion) on Russian-made equipment.

“It will allow us to organize modern production of telecommunications equipment in Russia,” he said, without naming operators or manufacturers.

Russia’s leading telecommunications operator MTS declined to comment for this story. Megafon, Veon’s Beeline and Tele 2, the other companies that make up Russia’s Big Four telcos, did not respond to requests for comment.

State programs to promote Russian equipment have helped telecom operators become less dependent on Nokia and Ericsson over the past few years, and Russian manufacturers have increased their market share to 25.2% this year from 11.6% in 2021. from

But cutting ties with foreign companies is expected by industry sources to set Russian communications back a generation as the rest of the world moves forward with 5G deployments.

“If this situation, presumably, continues for years, Russian mobile networks in terms of coverage may return to the state of the late 1990s, when their coverage was limited to large cities and the most affluent suburbs,” said IT chief Leonid Konik. Publication of ComNews in Moscow.

Rural areas will begin to collapse first as operators remove equipment to strengthen urban networks, telecoms experts say, while a lack of software updates could lead to network outages or exposure to cyber-attacks.

Chinese telecommunications equipment maker Huawei, Russia’s biggest seller with more than a third of the market last year, will continue software updates and maintenance but has stopped selling new equipment in Russia, according to sources familiar with the matter.

SOFTWARE UPDATES COMPLETED

The biggest obstacle for mobile operators to continue their networks will be the lack of software upgrades; Nokia and Ericsson said they would stop software updates and patches until next year, the sources said.

The software integrates a number of devices that make up the telecommunications network, converting analog and digital signals; monitors and optimizes network traffic; and protects the infrastructure from cyber attacks.

While mobile operators can stockpile hardware parts for future use, they depend on a regular schedule of licensed software updates and patches to maintain network integrity.

“Without a doubt, software patches are paramount to keeping networks operational, secure and reliable,” said Paolo Pescatore, analyst at PP Foresight.

Russian telecom operators are stockpiling foreign-made spare parts in February and March ahead of sanctions, two industry sources said, but stocks will drop after Nokia and Ericsson pull the plug on Dec. 31.

Government-mandated consolidation among Russian operators could also allow them to share equipment and resources to make networks last longer, industry sources added.

Huawei, which stopped selling new equipment in Russia when the United States began imposing sanctions on Russia, has also stopped selling its smartphones in the country, according to three sources familiar with the matter. Huawei has not publicly disclosed its status in Russia and declined to comment. (Reporting by Supantha Mukherjee in Stockholm and Alexander Marrow in Moscow; Editing by Kenneth Lee and Chris Sanders)

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