Sitronics Will Partner with Chinese to Navigate by Satellite

The Russian IT company Sitronics has signed an agreement with the Chinese ZTE on the establishment of a joint enterprise to produce navigational equipment using the Russian GLONASS satellite system. Analysts say that the market for navigational services is growing leaps and bounds in Russia. Turnover on that market amounted to $50 million last year, a full six time greater than the previous year. The same analysts warn, however, that the new company will need major state orders to turn a profit.


Russian First Deputy Prime Minister Dmitry Medvedev visits Sitronics company office.

The agreement between the Chinese and AFL Sistema's IT division was timed to the visit of Chinese President Hu Jintao. The agreement envisages the establishment of a research center for the development of household appliance in Zelenograd. The appliances developed will be manufactured in China. There is a separate point in the agreement on the establishment of a joint enterprise to produce GLONASS navigation equipment. Neither the timeline nor the budget for the projects has been made public.

ZTE is one of the world's largest manufacturers of telecommunication s equipment. The Chinese government owns 51.8 percent of the stock in ZTE, and another 37.7 percent of it trades on the Hong Kong and Shanghai stock exchanges. The company's proceeds for the first nine months of 2006 were $2.013 billion. The company's capitalization as of March 25, 2007, was $4.643 billion.

The Russian GLONASS (Global Navigational Satellite System) is the only competitor to the American GPS (Global Position) system in the world today. The Russia system is supposed to come online at the end of this year, after the launch of the 18th GLONASS-M satellite. Then the owners of a GLONASS navigational systems will be able to determine their positions within Russia to an accuracy of 10-15 km. The system will be available worldwide by the end of 2009, when 24 satellites will have been launched.

Analysts expect the Russian government alone to buy 700,000 GLONASS navigators.

Source: www.kommersant.com