OREANDA-NEWS. December 3, 2010. The Ukrainian government has introduced tariff regulation of the cable run system by including cable duct services to the list of ceiling tariffs regulated by the state. The relevant bill was passed by Parliament on Dec 2.

Millennium Capital deems this news as NEUTRAL for Ukrtelecom. The Ceiling tariffs introduction will deprive Ukrtelecom, the telecom monopoly incumbent covering 90% of the cable infrastructure, of the competitive advantage that made it possible for the monopolist to establish access fees at its own discretion. However, we do not regard this will impair the core profitability of the incumbent since its revenues are expected to be mainly driven by broadband momentum and labor cost optimization.