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MegaFon
MegaFon (Russian: МегаФон) is the second largest mobile phone operator[3] and the third largest telecommunications company in Russia, headquartered in Moscow.[2] As of 2024, the company serves 77.26 million subscribers across Russia and Tajikistan.[4] MegaFon operates accross 85 federal subjects of Russia, Tajikistan as well as territories of Abkhazia and South Ossetia. In 2002 the company changed its name from North-West GSM to MegaFon when it acquired several regional companies, becoming the first GSM company in Russia to cover all its territory. The name "MegaFon" in Russian is spelled and pronounced exactly like the Russian word for megaphone; other connotations are mega- as "big" and fon as "telephone". History June 17, 1993, was the registration date of North–West GSM CJSC (Saint Petersburg). Alexander Malyshev became the first General Director. The major international investors included Scandinavian companies Sonera (Finland), Telia International AB (Sweden) and Telenor Invest AS (Norway). Telecommunication equipment was supplied by Nokia.[5][6] 1994 – launch of commercial operation of GSM (2G) network, the first in Russia.[7][8] 1999 – number of the company's subscribers became over 100,000. By that time the network of the North-West GSM had completely covered Saint Petersburg and Leningrad region, it was also actively expanding in the northern areas of the Russian North-West.[9] July 1999 – North-West GSM was the first Russian operator that signed roaming agreements with all countries in Europe. The same year, for the first time ever in Russia, mobile communication started to operate in Saint Petersburg metro, and the operator's spectrum of value-added services included WAP-access to the Internet. 2000 – shareholders of the company adopted a new strategy that was targeted at the mass market.[10][11] November 2001 – number of North-West GSM subscribers exceeded 500,000.[12][13] May 2002 – The number of North-West GSM subscribers exceeded 1 million.[14] May 7, 2002 – in the course of rebranding North-West GSM CJSC was renamed to MegaFon OJSC. Rebranding of the company was started on April 28, 2002, by change of the logo. At that moment, North-West GSM was merged with Sonic Duo CJSC (Moscow), Ural GSM CJSC (Yekaterinburg), Mobicom-Kavkaz CJSC (Krasnodar), Mobicom-Center CJSC, Mobicom-Novosibirsk CJSC, Mobicom-Khabarovsk CJSC, MCS-Povolzhie OJSC, Volzhsky GSM (Saransk, Republic of Mordovia).[15][16][17][18][19] On October 2, 2007, MegaFon launched for operation the first Russian fragment of the third generation network in IMT-2000/UMTS (3G) at the territory of Saint Petersburg and Leningrad region. For the first time ever in this country the radio access sub-system UTRAN (UMTS Terrestrial Radio Access Network) was launched for trial commercial operation and included 30 base stations. And already on October 24, 2007, MegaFon announced about start of 3G service in Saint Petersburg and Leningrad region. For the first time in Russia, the following services became available for mass users: Internet access at the data transmission speed that is ten times higher than in the existing GSM networks (2G and 2,5G) of GPRS/EDGE technology, high-quality Mobile TV, video communication.[20][21] December 2008 – the extraordinary General Shareholders Meeting of MegaFon took a resolution on reorganization of MegaFon OJSC in the form of its merger with Sonic Duo CJSC (Moscow), Ural GSM CJSC (Yekaterinburg), Mobicom-Kavkaz CJSC (Krasnodar), Mobicom-Center CJSC, Mobicom-Novosibirsk CJSC, Mobicom-Khabarovsk CJSC, MCS-Povolzhie OJSC. The number of subscribers exceeded 43.2 million.[22][23] On March 16, 2009, MegaFon founded a virtual mobile network operator "PROSTO" (Just for Communication) on the basis of the Stolichny Branch.[24][25][26] On July 1, 2009, reorganization was completed, and now mobile communication services in Russia are provided by the North-West, Stolichny, Kavkaz, Center, Volga, Ural, Siberia and Far East branches of MegaFon OJSC.[27][28] On September 25, 2009, it was announced about rebranding of TT mobile CJSC, subsidiary of MegaFon that provided telecom services under the brand of MLT – "Mobile Lines of Tajikistan". The new company's name is MegaFon-Tajikistan.[29][30][31] Since March 1, 2010, Ostelecom CJSC started to provide telecom services in the Tskhinvali region (occupied territory of Georgia) under MegaFon brand.[32][33][34][35] In June 2010, MegaFon acquired 100% shares of Synterra company, which was a move to strengthen network infrastructure and enhance the positions in the markets of long-distance communication, fixed and mobile broadband access to the Internet, as well as convergence services.[36][37] Three months later, the extraordinary General Shareholders Meeting of MegaFon unanimously approved acquisition of 100% shares of PeterStar CJSC from Synterra.[38][39][40] Based on the results of Q3 2010 MegaFon became the second-ranked operator in mobile revenue.[41][42][43] Based on Q3 2010 results MegaFon became the leader in the revenue share from value-added services (VAS) among the Big Three operators.[44][45] As a result of 2010, MegaFon became the Top 2 operator (after MTS) in number subscribers among the Russian cellular communication providers.[46][47][48][49][50][51] As a result of 2010, MegaFon acquired the Top Second position in terms of revenue among the Russian Big Three operators.[52][53][54][55] On July 20, 2011, it was announced about rebranding of TT mobile CJSC. MLT brand was renamed to MegaFon-Tajikistan.[29][30][31] In November 2011, MegaFon signed a partnership agreement with Scartel on joint development of the Fourth Generation networks LTE (Long Term Evolution) in Russia. As a result, the company got the opportunity to provide LTE 4G services using Scartel's equipment. In its turn, Scartel will be able to use MegaFon's infrastructure.[56][57][58] In December 2011, the company created MegaLabs, 100% subsidiary, which is the single center of design and launch of value-added services.[59][60] In August 2012 MegaFon released its first smartphone called Megafon Mint in Russia with the new Intel Atom (system on chip).[61] In December 2013 the company received a licence for cable television broadcasting.[62] In January 2014 the company has launched international roaming data networks in the fourth generation. The first countries where service is available are Switzerland and South Korea.[63] The same month MegaFon CEO Ivan Tavrin obtained a 12% stake of VK.com, Russia's most popular social networking website, from VK's founder Pavel Durov.[64] In February 2014 board of directors of MegaFon has approved a deal to buy a 100% voting stake in SMARTS Volgograd, a unit of mobile firm SMARTS which covers the Volga and central regions of the country.[65] In the same month, MegaFon commercially launched fragment network LTE Advanced (LTE-A) within the Garden Ring in Moscow. Formerly MegaFon network tested LTE-A in the 2014 Winter Olympics in Sochi. For this Megafon uses bands in the range 2600 MHz own unique combination of frequency spectrum and network resource of Skartel as a mobile virtual network operator (MVNO).[66] In 2021, the company's revenue amounted to 313 billion rubles.[67] In March 2022 MegaFon is expelled from the GSMA association.[68] In April 2023 Megafon was sanctioned by USA on basis of being part of USM company, belonging to Russian billionaire Alisher Usmanov.[69] Megafon said it viewed the sanctions as "an unfair and illegal step that has no basis," and followed to lodge a counter case against EU sanctions.[70] Hardware brandingStarting in 2015, the company began production of hardware under "MegaFon" brand. These include fixed and mobile phones[71] OwnershipThe company went public in 2012, listing on stock exchanges in Moscow and London. In July 2018, the company's board of directors announced that being a public company was no longer considered a strategic priority and that it would seek to repurchase its GDRs shares from the market and delist, initially from the London Stock Exchange. GDRs were delisted in London in October 2018. The GDR repurchase consolidated more than 75% of ownership in the company, which triggered a mandatory offer to minority shareholders in December 2018. Shares were delisted from the Moscow Exchange in June 2019. Formally shares in the company are now split between USM Telecom (43.68%) and a wholly owned USM subsidiary, AF Telecom Holding (56.32%). Sponsorship
Criticism
By November 2012 MegaFon received a number of orders from Russian telecommunication and consumer market authorities to amend contracts with its 63 million subscribers and to make these contracts compliant with requirements of Russian law.[74] All MegaFon's attempts to challenge these orders in Russian arbitration courts were unsuccessful.[75][76] Also in 2012, several arbitration cases in Russian courts ruled that MegaFon violated consumer rights.[77][78][79] MegaFon did not meet requirements of Russian legislation and did not report any legally required certificates of compliance to the Federal Communications Agency Rossvyaz.[80][81] On 28 January 2021, Liberal Democrat MPs called for sanctions to be imposed on Russian oligarchs, linked to British football clubs (including MegaFon executive Alisher Usmanov and Chelsea owner Roman Abramovich) in response to the poisoning of Russian Opposition figure Alexei Navalny.[82] References
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