Two new government-backed Russian mobile operators – Osnova Telecom and RusEnergoTelekom (RET) – could controversially be awarded LTE spectrum this week, reports Vedomosti, a Russian business daily. Russia’s Defence Ministry, which currently holds the bulk of spectrum, is planning to hand over the frequencies to the new start-up operators without a tender process, despite protests from Russia’s big three operators – MTS, MegaFon and VimpelCom – which have yet to receive the new bandwidth. Vladimir Yevtushenkov, head of AFK Sistema (owned by MTS), and Mikhail Friedman, founder of Alfa Group (which owns VimpelCom), reportedly met with Russia’s First Deputy Prime Minister Igor Shuvalov on Thursday to ask him not to give away the LTE frequencies without a tender, a private partner of Alfa Group told Vedomosti.

According to the newspaper, Russia’s Communications Minister Igor Shchegolev postponed a meeting last week to discuss the transfer of the spectrum to Osnova Telecom and RET, following complaints that valuable assets were being given away behind closed doors. Russian President Dmitry Medvedev instructed Shchegolev to look into the distribution of frequencies after the heads of the big three operators sent a letter of complaint to him and Prime Minister Vladimir Putin. The operators argue that the construction of the federal network would take five years and cost US$5.7 billion if the new start-ups were awarded the LTE frequencies. However, Osnova Telecom – in which Russia’s Defence Ministry owns a 25 percent shareholding – has said that the build-out would only take two years and cost no more than US$2 billion.