Motorola Gear Expands Russian Carrier's Coverage

By Colin C. Haley

Motorola's network equipment division has won an $80 million order from Mobile TeleSystems (MTS) (Quote, Chart), the latest deal between the mobile equipment maker and Russia's largest wireless provider.

Motorola will supply Global Systems for Mobile/General Packet Radio Service (define) base stations to allow the carrier to expand network coverage and capacity in Moscow, Central Russia and the Urals.

The companies have been doing business since 1994. In their last transaction in September, Motorola installed a softswitch (define).

A Motorola spokeswoman in Russia was not immediately available for comment.

In a statement, Margaret Rice-Jones, a Motorola vice president and regional manager, said, "This is the largest contract we have signed with MTS during our 11-year relationship and extends the areas in which we work together yet further with expansion into the Urals region."

MTS said its history with Motorola made it a natural choice to help with expansion. The company and its subsidiaries boast more than 40 million subscribers.

Other telecom gear vendors have also been active in Russia in recent years. For example, Lucent Technologies (Quote, Chart) has helped Moscow Cellular Communications build out its mobile network.

Russian business leaders have been pushing for increased interaction between IT companies there and in the United States. At a recent speech to software executives in Boston, former USSR President Mikhail Gorbachev extolled the virtues of the Russian outsourcing industry.

However, the country still has obstacles to overcome, especially the perception that Russia is politically and economically unstable.

That image problem wasn't helped today when Mikhail Khodorkovsky, former head of a Russian oil giant Yukos, was convicted on fraud and tax evasion charges and sentenced to nine years in a prison camp. Khodorkovsky ran afoul of Russia's President Vladimir Putin, and the Yukos case was widely viewed as politically motivated.