No Breakthrough in Telenor/Telekom Srbija Landline Talks - Media

BELGRADE (Serbia), February 19 (SeeNews) – Pricing has been the sticking point in talks Norway's Telenor is conducting to lease landline capacity from state-owned incumbent Telekom Srbija which it needs to operate Serbia's second fixed-line network, Belgrade-based media reported on Friday.

The lack of progress means Serbia's telecommunications regulator, RATEL, will have to step in, news daily Danas (www.danas.rs) reported, quoting unnamed sources.

Last month, Serbia said it had accepted a 1.05 million euro ($1.42 million) offer from Telenor Serbia, the local wireless unit of the Norwegian telecommunications group, placed in a tender for a landline permit launched in late 2009.

RATEL was due to formally issue the licence on Friday.

Telenor said in January it will seek to lease infrastructure from Telekom Srbija, the country's sole fixed-line operator, in order to fulfill the licensing requirement to make the service commercially available in a year from now, Danas said, adding that Telenor planned to offer a price based on international standards.

As the two sides have failed to come to a pricing agreement, there is a possibility that RATEL may declare Telekom Srbija an operator with a dominant market position which would allow the regulator to intervene and set a lease rate, Danas said.

Telenor is prepared to hold up its end of the deal when it comes to infrastructure investment and it expects that RATEL, within its mandate, will regulate prices and the access to Telekom Srbija's infrastructure in line with relevant international standards, the Norwegian group told Danas.

RATEL declined to comment, saying it has not been formally notified of the outcome form the negotiations between the two companies, the daily said.

Telekom Srbija also controls about 70% of the domestic wireless services market through its MTS unit.

($=0.7396 euro)

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