Universal Service Obligation and Bridging the Digital Divide

Universal service obligation is commonly used throughout the world to ensure that basic communication services are available at an affordable price to all citizens. In Russia, the universal service concept was introduced by the Federal Law On Communications. Universal service includes:

telephony via payphones, multifunctional devices, information terminals, and similar devices (installed within an hour’s walk from a person’s home in most communities across the country)
data transmission and internet services via public access points (to be installed in all communities with a population between 250 and 500 people).

In accordance with the Federal Law On Communication, the Government of the Russian Federation shall assign the universal service obligation across the country to an operator holding a significant share of the public communications network in at least two-thirds of the Russian Federation regions. Rostelecom is the only operator that meets this criterion.

As the only designated universal service provider throughout the Russian Federation, Rostelecom is ensuring the operation of 148 thousand universal payphones; under the universal service obligation, any Russian citizen must have access to a universal payphone within an hour’s walk. Moreover, the Company shall install Wi-Fi access points with bandwidths of at least 10 Mbps at almost 14 thousand communities with a population between 250 and 500 people and payphones installed.

Universal service payphones have an important social function: they are as yet the only communications channel available in many remote and hard-to-access areas. In 2018, Rostelecom made all local and intra-zone calls free of charge. Within the region where a universal service payphone is installed, any landline phone can now be called completely free.

The Company has made yet another step to make the universal service more affordable and easy-to-use for the general public. Neither money nor a phone card is now required to call one’s family or friends from another district or town or to contact a hospital or another institution located in the regional centre. This is to help rural residents handle most day-to-day tasks remotely and free of charge.

To install Wi-Fi access points in small communities, the Company has launched its Bridging the Digital Divide project. Under a ten-year agreement signed with the Federal Communications Agency (Rossvyaz) under the BDD project, Rostelecom will install internet access points with bandwidths of at least 10 Mbps at almost 14 thousand communities with a population between 250 and 500 people. A smartphone or another Wi-Fi enabled device is required to use the internet service. To increase the availability of universal service during summer 2018, Rostelecom completed a phased migration of Wi-Fi points to a new platform and a single Wi-Fi network. Logging in has become easier and more straightforward: wherever the customers are, the network name they see on their screen remains the same, Rostelecom_UUS, and they can log in by sending a text message, using their account on the public services (e-government) portal, or calling to a toll-free number.

New communications lines bring services previously available in large cities only to small villages. In 2018, Rostelecom installed 722 km of fibre-optic communications lines (FOCL) in the Amur Region, 575 km in the Khabarovsk Territory and 435 km in the Primorye Territory.

Rostelecom’s internet service in the Arkhangelsk Region

In 2018, in furtherance of the Bridging Digital Divide project, Rostelecom brought internet to 23 rural communities in the Velsky, Kargopolsky and Ustyansky districts of the Arkhangelsk Region. To that end, the Company’s engineers installed 520 km of FOCL during the year.

Since the launch of the respective federal programme in 2015, internet service has been expanded over 87 communities with a population between 250 and 500 people in the Arkhangelsk Region and the Nenets Autonomous Area.

«In 2018, we met our target for the number of internet access points. However, we modified the original list of communities in the course of network expansion, mostly because we had to coordinate the communications lines’ routing. Despite all challenges, we will continue our efforts to provide the region’s rural population with internet access.»

Andrey Prishchemikhin, Director of Rostelecom’s Arkhangelsk Branch

Rostelecom’s free Wi-Fi service in the Kaliningrad Region

In 2018, wireless internet access points were launched in 19 Kaliningrad Region villages. Since the commencement of the respective project, Rostelecom has launched a total of 97 public internet access points in the region. To that end, over 500 km of FOCL have been installed.

«In 2014, the region’s communities with a population between 250 and 500 people were covered under the Bridging the Digital Divide project in line with the decision made by federal authorities. The Kaliningrad Region has 127 such communities. At present, authorities at all levels consider whether rural communities with a population between 100 and 250 people should also be covered under the programme to increase internet penetration across Russia.»

Victor Fedosov, Technology Director of Rostelecom’s Kaliningrad Branch

FOCLs in the Far East

In 2018, Rostelecom commissioned 3,669 km of FOCL in the Far East, a several-year high. These FOCLs helped bring broadband internet access to residents of remote communities with Yakutia accounting for over one-third of the lines installed in 2018. Rostelecom installed 1,472 km of FOCL in the Republic of Sakha (Yakutia), including over 650 km for the final phase of the Vilyuy Express project.

«Fast and reliable internet has reached private households and healthcare centres giving people new opportunities to study, work, and communicate. I believe that the development of the communications infrastructure will contribute to Yakutia’s social and economic growth.»

Vladimir Solodov, Chairman of the Republic of Sakha (Yakutia) Government

In 2018, our Wi-Fi user base grew tenfold year-on-year to 236 thousand while our data traffic exceeded 4.8 PB, up 2.6 times year-on-year.

BDD in the Republic of Mari El

In 2018, Rostelecom installed almost 100 km of FOCL in the Republic of Mari El. Wi-Fi internet access was launched in nine Novotoryal District communities. Since the commencement of the BDD project in 2015, Rostelecom has connected 110 small villages in the Republic of Mari El giving internet access at bandwidths of at least 10 Mbps to over 30 thousand residents.

«Bridging the Digital Divide contributes to the development of small rural communities. Today, residents of remote areas have access to modern technology and digital services same as their urban counterparts.»

Venedict Suvorov, Director, Information Technology and Communications Department of the Republic of Mari El

BDD in the Kirov Region

In 2018, Rostelecom installed 1,000 km of FOCL in the Kirov Region, including 380 km laid to bring internet access to 97 healthcare centres and over 500 km laid under the BDD project. Active Wi-Fi access points are now found in 92 small communities in the region. Over 100 km of FOCL were installed to connect 350 public institutions and businesses. Broadband services are now available to the local branches of the National Guard of Russia, Kirovenergo, and Vyatavtodor.

«Demand for digital solutions in business and the public sector is growing, and we develop our communications networks to respond to the customers’ needs. Since 2014, rollout of fibre in our region has increased fivefold. By expanding digital infrastructure, we are providing a foundation for the development of digital economy.»

Evgeny Valov, Director of Rostelecom’s Kirov Branch

BDD in the Ulyanovsk Region

In 2018, Rostelecom launched Wi-Fi internet access in 22 small Ulyanovsk Region communities. To that end, the Company installed 296 km of FOCL. The construction of these fibre-optic lines through difficult terrain proved a challenging task. We laid our FOCLs across ravines in the Pavlovka District, thick forests in the Kuzovatovo District, and hills in the Sengiley District.

«Internet access helps improve the quality of life for rural residents. Fibre broadband enables them to benefit from online services same as their urban counterparts. Residents of small communities can now book a doctor appointment, buy goods, and pay their bills online, contact social welfare institutions, as well as connect with their family and friends on social media.»

Elena Alpova, Director of Rostelecom’s Ulyanovsk Branch

Smart City

Rostelecom has implemented various Smart City projects across 50 Russian regions to improve city management. The Company’s projects introduce digital technologies in transport (intelligent transport systems, traffic safety), safety (city surveillance, emergency management), utilities (smart metering systems, inventory control), energy efficiency enhancement, and other areas.

In 2018, the Russian Ministry of Construction, Housing, and Utilities approved an industry-wide Smart City project for digital transformation of cities. Rostelecom joined the national Smart City Centre of Excellence and ANO Digital Economy Smart City working group.

Smart City projects are one of the Company’s business growth drivers. In 2018, Rostelecom’s revenue from Smart City projects was at RUB 23.2 billion, up 46% year-on-year.

The Smart City project is aimed at making Russian cities more competitive, improving the efficiency of city management, and creating a safe and comfortable environment for urban residents. It is designed around five fundamental principles:

Focus on the people
Technology-driven cities
Enhanced city management
Comfortable and safe environment
Emphasis on cost efficiency, including public services

Smart City aims to enhance the efficiency of city management and improve the quality of life in cities by introducing advanced digital and engineering solutions.

Rostelecom showcased the solutions for the first-ever Smart City in the Urals

In December 2018, Satka, a town in the Chelyabinsk Region, hosted the Smart City: From Pilots to Large-Scale Initiatives interregional forum. Teams of government officials from the Tyumen and Kurgan regions came to collect the lessons learned from the Smart City pilot in the Urals. As one of the 36 cities selected by the Russian Ministry of Construction, Housing, and Utilities to implement comprehensive Smart City solutions, Satka ran the first pilot in the Urals. The project is being implemented under agreements between the regional government, the Satka District administration, and Rostelecom.

«Satka has already run a few pilots related to improving municipality—citizen communication, energy efficiency, and safety. It is essential that other Chelyabinsk Region communities also introduce digital services for the public. We would be happy to serve as a pilot region for the introduction of best practices generated by the Digital Economy of the Russian Federation national programme. This target was set by Governor of the Chelyabinsk Region Boris Dubrovsky, and we are steadily moving towards it.»

Alexander Kozlov, Minister of Information Technology and Communications of the Chelyabinsk Region

Smart City in Kursk

In December 2018, Rostelecom took part in a meeting held by the Kursk Chamber of Commerce and Industry to discuss the matters of driving digital economy in the region. At the meeting, the country’s largest digital services provider presented Smart City solutions and reported on the Safe City project that had already been rolled out in Kursk. Rostelecom engineers had connected all of the city’s emergency services into a unified emergency call processing system that may be contacted by dialling 112. Moreover, to contribute to the city residents’ safety, a video surveillance system has been deployed. CCTV cameras monitor the areas near apartment block entrance doors and control the city’s road traffic. These solutions were included in the Safe City project.

«Smart City system implies running an ongoing extensive, artificial intelligence-driven analysis of many disparate data. Rostelecom has all the requisite capabilities in place. Some of these solutions have already been deployed by our Kursk engineers and provide a solid foundation enabling us to roll out a full-scale project. Its core objective is to merge various municipal services and departments into a single digital environment.»

Sergey Ovcharov, Deputy Director of Rostelecom’s Kursk Branch, Director for B2B and B2G

Rostelecom’s smart street lighting comes to Vyatskiye Polyany

In 2018, under an energy service contract with the city administration, Rostelecom upgraded the city’s street lighting system. By deploying an automated street lighting control system and installing modern energy saving street lights, the municipality will cut street lighting costs by 70%. Over six years, at least 5.7 million kWh will be saved. Instead of old street lights, Rostelecom engineers installed 2,333 LED lights. Unlike the previous generation bulbs, these lights can be switched on instantly, consume a fraction of the power and have a 10+ years’ service life. The Company replaced all damaged and broken lamp posts and consoles, reconfigured the power supply scheme, and reduced the number of power supply stations by 25%. Thus, the system’s operating costs were reduced, whereas its reliability increased.

«This was the third smart street lighting project to be implemented in the Kirov Region. The first two were in Kirovo-Chepetsk and Kotelnich. Rostelecom spends its own funds for these projects and expects to return the investments over the next several years by charging the cost of energy saved thereby. As a result, our cities receive state-of-the-art automated street lighting systems without spending a penny of their municipal funds.»

Evgeny Valov, Director of Rostelecom’s Kirov Branch

Rostelecom, Tele2 Russia, and Ericsson tested innovative utilities solutions in Moscow and Saint Petersburg

Rostelecom, Ericsson, and Rostelecom’s mobile operator Tele2 Russia tested an IIoT solution for utilities. Pilot testing of a new solution for energy companies was held in Moscow and Saint Petersburg. During the testing, an automatic meter reading solution was deployed. The tests were run in pursuance of a memorandum of understanding signed by Rostelecom, Ericsson, and Tele2 Russia in November 2018.

The data network for testing was based on Tele2 Russia’s infrastructure and used Ericsson’s technology. Data transmission was arranged via Rostelecom cellular modems.

During the Moscow and Saint Petersburg tests, power meter data were transmitted via Tele2 Russia network to the modem manufacturer’s server. The tests confirmed the efficiency of smart meters that enable power distribution companies to optimise costs while providing consumers with more comfort in using their services.