PRESS: Small cable operators to bear third of data retention charges

MOSCOW, Mar 6 (PRIME) -- Russian small and medium-sized wireline operators could bear a third of all expenses needed from connection operators to comply with the data retention law and estimated at 1 trillion rubles in the current reading of the regulation or 100 billion rubles if it is softened, business daily Kommersant reported Monday.

The country’s cable TV association warned Communications Minister Nikolai Nikiforov of risks implied by the law for small and medium-sized operators, which hold about a third of the consumer market.

If companies do not find money to stick to the law, networks that broadcast national channels can be cut off. According to the association, now some 30% of households get access to these channels via small operators: these are local firms servicing several blocks of flats, among others.

President of the regional operators association Yury Dombrovsky found the calculations close to reality.

“The economy of fulfilling the law, creation of corresponding data storage facilities is that small and medium-sized companies will suffer bigger losses than large operators that violates the competitive equilibrium, which we’ve said several times in our applications to the Federal Antimonopoly Service,” he said, adding that regional operators will face a burden of 10 billion rubles.

TMT Consulting’s General Director Konstantin Ankilov said that traffic of local and federal connection operators is comparable, but the latter have more opportunities to earn than the former.

As a result, as Finam’s analyst Timur Nigmatullin said, regional operators will quit the market, while big operators will get consolidated and dominate.

The controversial law, signed by President Vladimir Putin in 2016, obliges connection operators and Internet companies to store content of calls and the information exchanged by subscribers for up to six months from July 1, 2018. Metadata must be stored for three years by connection operators and for one year by Internet companies from July 20, 2016.

Internet companies are also obliged to provide the Federal Security Service with keys in case of additional encoding of messages.

(58.9099 rubles – U.S. $1)

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