Quarterly report

Subscriber radio access networks are based on DECT equipment in the Astrakhan, Volgograd, Kabardino-Balkarian, Krasnodar and Northern-Ossetia branches, eMGW (MultiGain) in the Astrakhan branch, CDMA in the Rostov and Northern-Ossetia branches, KART - 4 in Adygeia, Astrakhan, Rostov, Northern-Ossetia and Stavropol branches, as well as single-channel radio extensions such as "Les - 1", UTK-1, VHG-301, « Altay AC – 3SМ », SN-358R Ultra.

Document communication networks

Telegraph networks (TgOP, АТ/telex).

Capacity of telegraph networks is not increasing due to reducing demand for services of traditional telegraphy. Nevertheless telegraph networks still operate being maintained at the appropriate level and updated. Telegraph sets and out-of date message switching centers are being gradually replaced by modern computer-based terminals and integrated switching centers.

Data transmission and telematic network

"UTK" PJSC develops data transmission and telematic networks at all levels in order to offer its subscribers a full range of modern telecommunications and multimedia services.

At present the Company develops:

• 
  corporate data transmission network in order to satisfy the Company’s own needs;
  
• 
  regional multimedia multi-service networks of "UTK" PJSC within the framework of formation of the Svyazinvest pilot zone for creation and development of the overall system of multimedia services provision including infrastructure of the centralized protected distribution of audio and video information in the cities of Krasnodar, Stavropol, Rostov and Nalchik;
  
• 
  broadband access for realization of the national program “Education”.
  

Wired radio networks.

Quality of wired radio networks is different in various urban and rural areas, that determines their development trends. If wired radio networks are available and profitable in some areas, they are being developed by replacing out-of-date and obsolete equipment. In areas where wired radio networks do not exist or do not gain profit, the Company introduces air radio (FM).

Primary networks.

Local primary networks

Local primary networks of "UTK" PJSC include interswitch city cable and radio-relay lines; cable, air and radio-relay interconnecting lines in rural TNs; subscriber access networks.

Interstation city cable primary networks are being developed on the basis of fiber optic communication lines using SDH-systems of STM-1 – STM-64 levels manufactured by Siemens, Alcatel, Lucent Technologies, Huawei.

In urban and rural areas where the laying of fiber optic cables is impossible or unprofitable, radio-relay lines are used. Radio-relay lines are applied with PDH (channels IKM-15, IKM-30, NxE1, E3) and SDH (STM-1) systems, and multi-channel radio-relay lines (Nх ТCh-channels).

Metallic cables using IKM-30, IKM-15 transmission systems as well as multiplexers and modems using xDSL technology (NxE1, E3) are used on local primary networks in rural area.

Subscriber’s access is organized through physical lines from metallic or optic cables via digital channels using xDSL technology and radio access technologies.

Intra-zone primary networks

Intra-zone primary networks use fiber optic channels with SDH of STM-1 – STM-16 levels transmission system and optic line terminals (NxE1); metallic cables with PDH digital systems, IKM-120, IКМ-480, IКМ-30, and analog transmission systems K-60P, K-120, K-300, K-1020С; air lines as well as radio-relay lines using PDH and SDH systems and multi-channel radio-relay lines.

Information about the length of FOLs is presented in table 5.

Table 5

	Length of cable lines, km		Length of radio-relay lines, km
	Total	Including fiber optic	Total	Including digital radio-relay lines
Total in "UTK" PJSC	11,153.247	10,321.591	1,241.54	799.24

Lease of channels.

Data on communication channels leased by "UTK" PJSC from other telecom operators in 2007

Channel type	Lessor’s requisites
	Service area	Name	Address
Voice frequency communication channels	Russia	Rostelecom	14, 1^st Tverskaya-Yamskaya Str. Moscow	One year with automatic prolongation
Digital channels	Russia	Rostelecom	14, 1^st Tverskaya-Yamskaya Str. Moscow	One year with automatic prolongation
	Russia	TransTeleCom	27, Nizhegorodskaya Str., Moscow	One year with automatic prolongation
	Astrakhan region	Astrakhan -GSM"	44, Lychmanova Str., Astrakhan	One year with automatic prolongation
	Volgograd region	Volgograd - GSM	19, Kommunisticheskaya Str., Volgograd	One year with automatic prolongation
	Volgograd region	Volgotelcom	11a, Novodvinskaya Str., Volgograd	One year with automatic prolongation
	Volgograd region	Svyaztransneftj	6, Lyublinskaya Str., Moscow	One year with automatic prolongation
	Southern federal district	Mobicom-Kavkaz	40, Luzana Str., Krasnodar	One year with automatic prolongation
	Krasnodar kray	Kubtelecom	341, Kalinin Str., Krasnodar	One year with automatic prolongation
	Russia	MTS	4, Marksistskaya Str., Moscow	One year with automatic prolongation
	Rostov region	Rostov cellular communication	64, Nakhichevanskiy per., Rostov-on-Don	One year with automatic prolongation
	Rostov region	Yug svyaz service	154, Bolshaya Sadovaya Str., Rostov-on-Don	One year with written notification on prolongation
	Russia	RZhD	2, Novaya Basmannaya Str., Moscow	One year with written notification on prolongation
	Stavropol kray	Stavtelecom	10/12, Oktyabrskoy revolution Pr, Stavropol	20 years starting from 1997

The features of analog and digital channels leased from outside entities meet the requirements of voice-frequency channel electrical parameters (RF Ministry of Communications Order № 43 of 15.04.96) and the requirements of digital channel electrical parameters (RF Ministry of Communications Order № 92 of 10.08.96).

2.