MOSCOW (WiMAX Day). Virgin Group announced this week that it has launched a national WiMAX network in Russia, under the name Virgin Connect. According to a press release, the network has been launched in 32 regions in Russia, including Moscow and St Petersburg.
The network has been launched by Virgin’s local partner Trivon AG, a Swiss company which Virgin invested in last year, and which had acquired a company that owned licenses to 5.8 GHz spectrum in Russia.
In a prepared statement, Sir Richard Branson, founder of the Virgin Group, said “Virgin Connect will demystify the complex tariff jungle and bureaucracy seen in the market over the last years. We will provide a fresh and human customer experience to Russians and believe that Trivon is the ideal partner to deliver this. Virgin Connect plans to gain a market share of 10% within 5 years in this promising market.”
The development of WiMAX networks in Russia is already well-represented by companies such as Enforta, Synterra, Start Telecom and Comstar, each with considerable spectrum holdings. Thus many commentators in Russia this week found it difficult to believe that Virgin might be able to garner ten percent of the WiMAX market, let alone the broadband market, within five years. Such market-share should require substantial investment of well over USD 150 million, and critical connectivity to the Internet backbone.
Moreover, while a Trivon press release notes that it’s partners include investment firms Delta Partners and Eurasia Capital Management, many Russian observers note that even if Virgin has the financial muscle to build a network, it lacks the spectrum necessary to build a network that is compatible or competitive with those of established players.