Gov't postpones UMTS rollout

The government agency that regulates the telecommunications market has agreed to postpone the start date for commercial third-generation services by a year after bowing to a request by Poland's three mobile operators, said Krzysztof Heller, the Infrastructure Ministry's undersecretary of state in charge of telecommunications. Heller told the WBJ that Witold Graboś, president of the Telecommunications and Postal Regulation Office (URTiP), would present his decision for a 12-month delay for third-generation mobile service to the government's Council of Ministers this week before issuing a formal announcement. Heller said the URTiP, created last month, wanted to first notify the executive body responsible for the state's domestic and foreign policy "to have if not approval, then a permissive nod from the government side."

The third-generation license agreements of the three mobile operators - Polska Telefonia Cyfrowa (PTC), Polkomtel and PTK Centertel - stated that they had to begin offering commercial service between Jan. 1, 2003 and Jan. 1, 2004. The wireless firms sent a letter to the former Telecommunications Regulatory Office (URT) last September, requesting a year-long delay before launching UMTS (universal mobile telecommunications system), which would require huge infrastructure investments. After the URT's President Kazimierz Ferenc failed to issue a decision within a legally binding 60-day period, they turned to the Infrastructure Ministry in early March to nudge the regulator. Under the URTiP's decision, the operators must now offer commercial service by Jan. 1, 2005. "I see no point in hurrying up the rollout of UMTS in Poland," said Heller, who favored the year-long postponement. "We are not such a rich country where we can afford to spend money on something that may or may not be a commercial success." Jacek Strzałkowski, the manager of the URTiP's communications department, would not respond to questions for this article. An employee in the URTiP's press office said no one else was available for comment.

Third-generation mobile service will not likely be offered commercially in Western Europe until 2004 or later due to a lack of handsets and infrastructure technology, huge costs and the generally unfavorable condition of the telecoms market. Poland's three wireless firms, which each paid €650 million for licenses in December 2000, estimate that UMTS rollout will cost $1 billion-$2.7 billion per operator. "Now we see this as a global trend and the technology is not as mature as some people believe it could or should be, and many other economic and investment aspects are slowing down the rollout," Heller said. "In addition there is this uncertainty whether this will really be an interesting market - whether people will buy (it)." Heller also said that the URTiP could consider another delay depending on the progress of UMTS in other European countries. "If we delay for a year, nothing inhibits us from delaying it further," he said. "(We'll) delay it for 12 months and see what happens, and if the situation is serious again then we may reconsider."