Sistema Shyam Teleservices (SSTL), a joint venture between Kolkata-based Shyam group and Russian telecom company Sistema SSA, on Thursday, launched its CDMA mobile prepaid services in Tamilnadu under the brand MTS which is the group's brand for mobile telephony the world over. Sistema has a controlling 73.71% stake in the venture.

MTS is also a company of the group and is listed on the New York Stock Exchange. There is an agreement between MTS and SSTL that allows the Indian joint venture to use the MTS brand and also access MTS technology and expertise.

In Tamilnadu, the company's network presently covers 373 towns and cities. In a phased manner, services would be expanded to cover 566 towns, that is, 51% of the population. The company has tied up with Hinduja Global Solutions for providing help desk support for its customers. The call centre will be located at Chennai.

As an introductory offer, Sistema has launched some competitive schemes such as one million minutes of free talk time to a new subscriber. The offer is for a limited period and there is a limit of 150 minutes a day. Initially, SSTL will offer only pre-paid services.

Prospective subscribers can choose to purchase a handset from MTS, and they can also choose to use their own handset.

All local MTS-to-MTS calls will be charged at 35 paisa per minute, while MTS-to-non MTS calls and calls to landlines will cost 70 paisa per minute. STD calls will cost Rs.1.40 per minute.

Shyam Telecom entered into mobile telephony with a licence for Rajasthan, but SSTL has since taken over the operations in the State. Rajasthan's operations are presently run under the brand 'Rainbow.' The company will also launch its services in Kerala next week, followed by West Bengal, Bihar and Jharkhand.

Sistema has licenses and spectrum to provide mobile telephony services on the CDMA platform in all 22 circles across the country. The company is planning to expand its services to 28 states in phases by launching service in one circle a month.

SSTL has plans to invest $5.5 billion in capital expenditure, primarily in telecom infrastructure development in India, over the next five years. It has also drawn up mega plans for investments in the real estate and financial sectors. Sistema plans to capitalize on the convergence of banking and telecom in the initial stages and may also set up full-fledged banking activities in India in the future.

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