Telenor Serbia

Telenor Serbia became a wholly-owned subsidiary of Telenor on 31 August 2006 through the acquisition of Mobi 63 d.o.o. Telenor Serbia offers advanced voice and non-voice services to subscribers on both a prepaid and contract basis. Non-voice services include SMS, MMS, mobile content services and Internet service. As at 31 March 2011, Telenor Serbia had a total of 3.1 million mobile subscriptions. As at 31 March 2011, the mobile penetration and number of inhabitants in Serbia were 119% and 7.3 million, respectively.

Network and licences

Telenor Serbia currently holds 10 year licences for GSM 900 MHz/1800 MHz and 3G which commenced on 31 August 2006, and are renewable for a successive 10 year period on application. In January 2010, Telenor Serbia acquired a licence for public fixed telecommunications networks and services. The licence was issued for 10+10 years and expires in 2030.

Competition

In addition to Telenor Serbia, there are two other mobile operators in Serbia: Mobile Telephony of Serbia (MTS), which is wholly-owned by the incumbent telecom operator Telekom Serbia, and VIP mobile, which is a wholly-owned subsidiary of Mobilkom Austria. Both MTS and VIP mobile hold GSM and UMTS licences. Telenor Serbia estimates that it had a market share of approximately 35.2% as at 31 March 2011. As at 31 March 2011, the market leader, MTS, had an estimated market share of 48.7% and VIP mobile had a market share of 16.1%. There are currently no service providers or MVNOs operating in the Serbian market for mobile telecommunication services. In addition, Telekom Serbia and Media Works (a member of Greenhouse Telecommunications Holding) acquired a CDMA 450 (FWA) licence in May 2009.

Regulatory matters

In regard to Telenor’s fixed licence issued in January 2010, Telenor concluded a contract with Telekom Serbia for access to unbundled local loop, collocation, transport capacities (dark fibre, ducts), and fixed termination rates. Telenor launched commercial fixed line services on 20 January 2011, thereby fulfilling the licence obligations.

Telenor has met with state officials on different levels to discuss the possibilities for resolving the following issues:

• Status of Telekom Serbia’s lawsuits against The Republic Agency for Telecommunication’s (RATEL) decision on terms and prices for access to Telekom Serbia’s infrastructure.
• Expected timeline for RATEL to set mobile-to-fixed termination rates at the same level as fixed-to-fixed termination rates. Telenor has filed a lawsuit against RATEL to require RATEL to set equal fixed termination rates. This lawsuit is ongoing.
• The use of RATEL’s enforcement procedures to efficiently resolve cases when Telekom Serbia rejects requests by Telenor for accessing their infrastructure.
  

Introduction of mobile number portability in Serbia is planned for the end of May or beginning of June 2011. RATEL has successfully finished internal testing of the central database (CDB). The operators have started testing of the CDB and installing applications. RATEL has drafted a rulebook on number portability for fixed location and Telenor is a member of the related industry working group. Adoption of the rulebook is expected in the second quarter of 2011.