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Ukraine Faces €4.38 Billion Post-war Bill to Rebuild Telecoms Industry Crippled by Russian Attacks

By Elliefrost @adikt_blog

Ukraine estimates it will need $4.67 billion (4.38 billion euros) over the next decade to repair an overlooked but expensive casualty of the ongoing Russian invasion: its telecommunications network.

Stanislav Prybytko, director general of the Mobile Broadband Directorate of Ukraine's Ministry of Digital Transformation, told Euronews Next in a series of estimates that Russia has destroyed more than 4,300 mobile base stations and a quarter of the country's internet networks since February 2022.

The country's fiber optic network has also been affected: so far, more than 30,000 km of cables, spread across Ukraine, have been damaged or destroyed during the fighting.

"The war continues and the losses are increasing day by day," Prybytko told Euronews Next.

"Electronic communications is one of the strategic and most important areas for the functioning of the state... any disruption or failure in this sector has crucial consequences for every area of ​​​​the population's existence."

Where most losses occur

The World Bank put the estimated damage to the telecommunications sector closer to $2.1 billion (1.97 billion euros) in a December 2023 report from Euronews Next, but confirmed Prybytko's figure for total needs.

That's because Ukraine's reconstruction plan would include not only physical repairs to telecom infrastructure, but also "capacity building in cybersecurity and other areas."

The report goes on to say that damage to critical communications infrastructure increased by 29 percent between 2022 and 2023.

The World Bank report shows that damage to telecommunications is not felt equally across the country, nor by who provides these services.

Forty-five percent of the total network damage is felt by fixed broadband operators, closely followed by mobile operators at 43 percent.

The rest is spread between the postal authorities and the broadcasters.

Ukraine faces €4.38 billion post-war bill to rebuild telecoms industry crippled by Russian attacks

Operators for Lifecell and Vodafone Ukraine, two of the three "backbone" telecom companies operating in the country, told Euronews Next that their companies have so far been able to absorb the costs associated with their damaged networks, but will not be able to do so if the war continues indefinitely.

Vodafone has already spent 2 billion hryvnia (€47 million) repairing more than 900 of their damaged sites, but a company representative previously told Euronews Next that the damage could be double that.

A similar picture at Lifecell, where at least a thousand locations have been repaired since the start of the invasion at a cost of 150 million dollars (138 million euros) from the company's own profits.

The picture is much less positive for smaller providers.

About 720 mobile and internet providers "suffered significant losses" over the course of the war, Prybytko said, with just under 100 on the brink of bankruptcy.

According to the World Bank report, the worst-hit area for telecommunications damage is between Donetska and Kharkovska Oblast, at 17 percent each.

The areas of Zaporizka Oblast, Chersonska Oblast and Kievska Oblast have also been severely affected; all are responsible for between 11 and 13 percent of the total damage to the country's telecommunications infrastructure.

Prybytko said the estimates are still the most reliable the government has, but may not reflect the damage already done in the early months of 2024.

'Extremely difficult' to reach occupied areas of Ukraine

Prybytko and the World Bank's estimates include only damage observed in non-Russian occupied territories.

Prybytko, along with Lifecell and Vodafone, told Euronews Next that it is "extremely difficult" to map the damage in Russian-occupied areas of the country.

Russia occupies parts of the Donetsk, Kherson, Luhansk, Mykolayiv and Zaporizhia regions of Ukraine, as well as the island of Crimea.

"The first thing the Russians do after occupying Ukrainian cities is deny people communications," Prybytko said.

"They often completely destroy or undermine telecommunications infrastructure or take equipment to Russia."

Engineers are regularly sent to the front lines of the Ukrainian war effort with only a helmet and a small first aid kit to repair mobile base stations hit by Russian shelling, Lifecell and Vodafone told earlier Euro news Next.

Their personnel will only be deployed if it is determined that it is safe enough to do so. On some occasions, both providers said their personnel are embedded with Ukraine's National Armed Forces to carry out their repairs in unsafe areas.

Prybytko said it will be difficult to return telecommunications to pre-war levels until there are "conditions for the safe life of consumers and service providers."

Yet the World Bank estimates that roughly 12 percent of all Ukrainian households have lost mobile connectivity: a problem, the report notes, that "affects not only personal communications, but also critical services and economic activities."

'Decentralization saves us'

Despite what Prybyto calls "constant shelling," he said he wants Ukraine's allies to know that the government and private providers are working together to keep citizens connected.

The government gave the example of Kharkiv, where it said 80 percent of the city's mobile base stations are still operational even though "almost the entire critical energy infrastructure has been nearly destroyed" by recent Russian attacks.

"This is possible in part because operators have prepared for disruptions in advance, purchased generators and set up technical teams to work in critical conditions," Prybytko said.

From the first day of the war, Prybytko said his ministry, the country's telecommunications regulators and individual carriers have joined forces to ensure Ukrainians can stay connected. This means that mobile operators share cell towers and generators and even their bases are destroyed.

The country's three largest operators also phased out roaming early in the country so customers could stay connected to one network or the other.

Ukraine is filling any gaps in this private telecommunications service with other forms of communications, Prybytko said.

Ukraine is also one of the largest users of SpaceX's Starlink, a series of satellites in space that transmit radio signals to users on Earth. According to Prybytko, the country uses 47,000 units.

"If fixed internet goes out due to a power outage, mobile communication helps, and vice versa," says Prybytko.

"And if the Russian occupiers completely destroy traditional networks, Starlink satellite communications will come to the rescue.

"[This] decentralization saves us".

In some cases, Prybytko says, the telecommunications industry is even growing.

During the second year of the invasion, the government said it had set up internet access in more than 5,000 educational shelters, 3,500 kindergartens and 571 health care facilities.

One of their goals this year, Prybytko said, is to open free WiFi zones in libraries, schools and service centers. A new pilot for 5G networks may follow.

Ukraine is also working to make its field of electronic communications "more transparent," with a view to their "eventual integration into the European Union," Prybytko said.

This is the second part of a two-episode series examining the impact of the Russian invasion on Ukraine's controversial telecommunications. Read the first part here.

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