The Armenia Telephone Company, briefly ArmenTel, is the largest telecommunications company in Armenia. It belongs to the second largest Russian mobile network operator VimpelCom (brand Beeline) since 2006.
In the Armenian SSR the Telefonie was adjusted by the post office and communication Ministry. The telephone network was operated in the capital Yerevan and the remainder of the republic by in each case a monopolist. 1995 were sold again created that Armenia of telephones company (ArmenTel) as a monopolist for international calls to 49% to the American company Trans World Telecom. 1996 fused ArmenTel with the operator of the telephone network of Yerevan and 1997 with the operator of the net in the remainder of the country.
In 1998 as a result of a corporate takeover Greece Hellenic Telecommunications Organization SA (OTE) acquired 90% of ArmenTel, the remaining portions remaining the property of the Armenian Government. The government granted ArmenTel a monopoly for telecommunication services for 15 years, while OTE committed to invest into Armenian telecommunications sector and bring it up to international standards. According to ArmenTel it has invested approximately 200 million USD in the years of 1998-2003.
However OTE was accused of abusing its monopolistic position and not fulfilling its obligations stipulated by the contract. Armentel’s monopolistic position resulted in a long-lasting series of arbitrage with regards to the compliance of its obligations to actual investments completed by Armentel. Up until 2004, when a compromise with RA Government was reached, Armentel severely exploited its positions by demanding high prices for low quality services (i.e. internet access tariffs were 3 times higher in RA that those in Georgia and Azerbaijan). In response investment promises were concertized and OTE consented to give up its monopolistic position of the portable radio section ArmenTel GSM for 7 USD millions. The above mentioned new agreement exterminated Armentel’s monopoly on mobile services, and shortly after that a Lebanon-based company K-Telecom introduced VivaCell brand to Armenian market.
ArmenTel is the second largest taxpayer of Armenia (e.g. in the year 2005 15.3 billion Dram, converted approximately 28 millions euro)
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