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. Last Updated: 07/27/2016

Transtelecom Opens in China

Transtelecom, the communications arm of state-run Russian Railways, on Tuesday opened an office in Beijing in an effort to promote its planned digital telecoms link with Asia.

Transtelecom's project to lay 28,000 kilometers of digital transmission cables across Russia, reaching Asian markets, has been under way for several years. It is in competition with a similar one by Rostelecom announced in 2004.

Russian Railways inherited many thousands of kilometers of analog telephone lines along its railway tracks from Soviet times.

Igor Kelshev, a Transtelecom senior vice president, said Tuesday that the company's digital link would have the capacity to carry 130 gigabytes of data per second and could generate annual turnover of about $500 million.

Kelshev said the project would give it control of up to 15 percent of the Eurasian high-quality data transfer market, which he predicted would quadruple by 2011.

Analysts said the two projects would considerably lower costs for data transmission between Europe and China.

"Before, companies and commercial organizations had had to rely on the expensive data transmission system through seabed cables under the Indian Ocean. Transtelecom's landline project is set to change that," said Anna Kurbatova, an analyst with Aton Capital.

"Transtelecom is now in pole position to provide multinational business entities in China with communication facilities to connect with their offices elsewhere," said Irina Petelina, an analyst with telecoms consultancy J'son & Partners. "It is a cheaper and more convenient alternative to the existing system."

Rostelecom could not be reached for comment Tuesday.