Eastern European Markets
March 16, 2005

Siemens expands GSM mobile networks for Russian operator MegaFon

MegaFon, one of the top three mobile operators in Russia, once again has chosen the telecommunications group of Siemens AG, Siemens Communications, as supplier for the expansion of its GSM networks. The framework agreement that was signed in August 2004 has now been extended from 60 to 200 million euros. It covers delivery and installation of GSM switching and radio infrastructure for the MegaFon branches in the Volga and Ural regions. The project will be implemented during the calendar year 2005.

With Siemens’ assistance, the federal mobile operator MegaFon can now significantly increase the network capacities of its companies MSS Povolghje, Ural GSM, Wolga GSM and Mobicom-Kirow in its licensed territories of Volga and Ural. “For MegaFon the quality of the network connection and services have a very high priority. The supply of mobile network infrastructure from Siemens in the scope of this agreement will enable MegaFon to maintain its high quality standards for its customers,” says Alexey Nichiporenko, executive vice-president of MegaFon.

“The signing of this agreement is a further demonstration of our efficient collaboration with MegaFon,” according to Christoph Caselitz, President of Mobile Networks at Siemens Communications. “This agreement marks the sixth year of successful cooperation between MegaFon and Siemens, and we are pleased to be able to continue supporting our partner in the development and modernization of its mobile networks in the Russian regions.”

The MegaFon Corporation is the first Russian mobile operator (GSM Standard 900/1800) to be operationally active in all Russian states. MegaFon was founded in May 2002 within the framework of a renaming and restructuring of CJSC Nord-West GSM and a consolidation with CJSC Sonic Duo, CJSC Mobikom-Kavkaz, CJSC Mobikom-Center, CJSC Mobikom-Novosibirsk, CJSC Mobikom-Khabarovsk, CJSC Mobikom-Kirov, OJSC MSS-Povolzhye, CJSC Volzhsky GSM and CJSC Uralsky GSM under one umbrella brand. The major shareholders of OJSC MegaFon are OJSC Telecominvest, Ltd. ZT-Mobile, Sonera (Finland) and Telia (Sweden). MegaFon’s license area spans 100 percent of the Russian territory – 89 regions with a population of 145 million. MegaFon currently has over 15 million mobile subscribers.

Siemens Communications
Siemens Communications is one of the largest players in the global telecommunications industry. Siemens is the only provider in the market that offers its customers a full-range portfolio, from devices for end users to complex network infrastructures for enterprises and carriers as well as related services. Siemens Communications is the world’s innovation leader in convergent technologies, products and services for wireless, fixed and enterprise networks. It is the largest Group within Siemens and operates in more than 160 countries around the world. In fiscal 2004 (year-end September 30), its 60,000-strong workforce posted sales of approximately 18 billion euros.

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